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HB 4718

Insurance: other; requirement to file a fraud report; provide for. Amends 1956 PA 218 (MCL 500.100 - 500.8302) by adding sec. 4506.

2025-2026 Regular Session Introduced by Joe Aragona and 9 co-sponsors

Michigan mandates insurance companies file fraud reports under new standards, increasing market oversight and potentially reducing consumer premiums if fraudulent claims are curtailed.

REFERRED TO COMMITTEE ON FINANCE, INSURANCE, AND CONSUMER PROTECTION
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Bill Summary · HB 4718

Legislative bill overview

HB 4718 amends Michigan's insurance code by adding Section 4506, which establishes a requirement for insurance entities to file fraud reports under specified circumstances. The bill passed the House with overwhelming support (102-1) and has been referred to the Senate Finance, Insurance, and Consumer Protection Committee for consideration.

Why is this important

Insurance fraud costs the industry billions annually, driving up premiums for all consumers. Mandatory fraud reporting requirements create accountability mechanisms and help regulatory bodies identify patterns of fraudulent activity. This can improve market integrity and potentially reduce insurance costs if fraud is successfully deterred and detected.

Potential points of contention

  • Reporting burden and compliance costs: Insurance companies may argue that new filing requirements create administrative expenses that could ultimately be passed to consumers through higher premiums
  • Definition and threshold ambiguity: Without seeing the specific language of Section 4506, it's unclear what constitutes reportable fraud or what threshold triggers mandatory filing, potentially creating inconsistent enforcement
  • Liability and false reporting concerns: Companies may face legal exposure if fraud reports are challenged or deemed inaccurate, potentially leading to defensive over-reporting or litigation costs

Compiled from official sources — confirm details with the bill’s official record.

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