Michigan’s Auto No-Fault law is changing, and it will affect your medical care coverage as much as it will affect how much you save on a policy. You may have questions, and we have answers – see below for our Frequently Asked Questions.
big changes
Michigan’s new auto insurance law will affect each driver differently – depending on the level of medical coverage — called Personal Injury Protection (PIP) — they decide to receive. Learn more about how the new policy on July 1, 2020 will affect you here.
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Under Michigan’s new law, drivers will be able to decide on their level of Personal Injury Protection (PIP) coverage. This change requires insurance companies to reduce premiums for PIP coverage for all drivers regardless of the level of insurance they purchase. Therefore, while your total savings will depend on the coverage you select, you should learn more about how this policy change – and the various levels of coverage – can impact you in the future.
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If you do not sign all of the forms but elect to continue Personal Injury Protection (PIP) coverage, your coverage will renew under the lifetime/uncapped PIP coverage.
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In 2019, Michigan’s lawmakers made changes to the state’s auto insurance policy. For decades, Michigan drivers have had unlimited coverage in the event of an auto accident, with medical care for the rest of their lives. This best-in-the-nation coverage also coincided with Michigan’s auto insurance rates being among the most expensive in the country.
The new law aims to help Michigan drivers save on their auto insurance policies by providing a choice on their level of injury coverage. It’s important to understand how this will affect your protection.
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The basic structure and coverage for motorcyclists has not changed. However, a motorcyclist or their passenger injured in a motor vehicle accident would be limited to the Personal Injury Protection coverage option chosen by the owner/operator of the motor vehicle involved in the accident.
coverage differences
No, these benefits are unique to Personal Injury Protection coverage. If a driver chooses to use their health insurance for medical coverage in auto accidents, they should call their health insurer to find out exactly what will be covered.
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If an individual is already covered from their auto policy due to injuries from an auto accident, they will continue to receive the current unlimited benefit regardless of their future Personal Injury Protection choice. This is also true if a member is injured in an accident between now and June 30, 2020.
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No, he will not receive Personal Injury Protection medical coverage under your policy. He may need to sue you for coverage – you will have to carry an umbrella policy for situations just like this. Contact your insurance agent for coverage options.
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If you lose your health insurance coverage that you were using as a substitute for Personal Injury Protection (PIP) coverage, you can contact your auto insurance agent or company to add PIP to your policy. You will have 30 days to do so.
new liabilities
In Michigan, you must be less that 50 percent at fault to sue the at-fault driver and show that you have a threshold injury - a serious impairment of body function.
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There are many more situations under the new law that expose drivers to the risk of being sued. Contact your agent to discuss increasing your liability coverage.
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As with any civil lawsuit, there is no guarantee that the at-fault driver will have enough liability coverage or personal finances to pay what they’re determined to owe you. There is no guarantee that you’ll receive any legally awarded funds. Drivers must pay their own legal fees if they choose to sue another driver.
individual crash-scenarios
For residents who are involved in an accident outside of Michigan, you will need to contact your insurance company to determine how they will handle auto accidents in other states. If a member is injured by an at-fault driver in an at-fault state, reimbursement is pursued from the at-fault driver’s auto insurance provider.
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A special fund called the Assigned Claims Facility exists in Michigan to pay Personal Injury Protection (PIP)-like expenses for those injured in an auto accident who rightly did not have their own PIP policy, such as a pedestrian or cyclist who doesn’t own a vehicle. These benefits were reduced in the new law and now provide $250,000 in coverage with some exceptions that grant additional coverage.
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Anyone riding as a passenger in a vehicle owned/operated by someone else is still covered first by their own auto insurance medical option. If you rightly do not have any coverage because you do not own and insure a vehicle, you will be covered by the Assigned Claims Facility with a limit of $250,000. Prior to the new law, the Personal Injury Protection coverage of the owner/operator of the vehicle in which you’re riding would have extended to you. That is no longer the case under the new law.
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Your coverage (or that of your spouse/household member) applies first. If you do not have coverage, you’ll be covered by the company insuring the Uber driver and up to the amount of coverage they purchased. Uber/rideshare drivers must purchase either $250,000, $500,000 or unlimited Personal Injury Protection coverage. They may not opt out.
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Medicare will pay for Medicare-covered services to enrollees who opt out of Personal Injury Protection medical benefits, are injured in an automobile accident, and have no other available coverage. The Medicare member will remain financially responsible for coinsurances, copayments, deductibles, and for any services Medicare does not cover, such as transportation to and from medical appointments, vehicle modifications, case management services, residential treatment programs, long-term and custodial care, and replacement services.