Michigan is a no-fault state for car insurance. In the event of an auto accident, a Michigan driver’s no-fault PIP (personal injury protection) insurance pays for his or her own medical expenses, lost wages and at-home services like cleaning or laundry. It does not matter who caused the accident.
All Michigan drivers must carry unlimited PIP insurance. This means your policy will pay all reasonably necessary medical expenses with no maximum dollar or time limit. It will also pay up to 85% of the income you would have earned if you had not been hurt, for up to three years. In addition to PIP, Michigan drivers are required by law to carry bodily injury liability insurance of at least $20,000 per person ($40,000 per accident), plus $10,000 for property damage in another state.
Currently, Michigan is one of the strictest no-fault states in the country, allowing insured drivers to be sued only under very limited circumstances:
- If you cause an accident in Michigan in which someone is killed, seriously injured, or permanently disfigured;
- If you are involved in an accident in Michigan with a non-resident driving a car not registered in Michigan;
- If you are involved in an accident in another state.
If you are sued, your liability policy will pay up to its limits. If the court awards more than your limits, you are personally responsible for paying the amount not covered.
With all of that being said, a new Michigan no-fault law has recently been passed by the state legislature, and many changes are scheduled to go into effect in 2020. They include changes in liability limits and PIP coverage options. The new law is complex and is likely to have complicated effects on insurance coverage and costs in the state. Before you renew your policy in 2020, talk to an insurance expert about your choices and get multiple quotes to find the best value for your needs.
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