What is Michigan No-Fault Insurance
The Michigan no-fault system requires your insurance company to pay you for the damage to your car from an accident, regardless of who is at fault. The other driver will get the costs to repair their vehicle from their insurance company. In the Michigan no-fault system, you do not have to decide who is at fault to receive payment for your damages. The law requires you to carry Michigan No-Fault insurance. Having coverage is mandatory when you register your vehicle.
The Michigan No-fault insurance policy has three essential parts:
Michigan No-Fault: Bodily Injury and Property Damage (BI/PD) coverage
The first section is bodily injury and property damage; this coverage will protect you and your assets if the other driver sues you as a result of an auto accident. In Michigan, they can also sue you if you hurt someone with your vehicle, causing a substantial injury to the other driver, passenger, or pedestrian. This coverage covers the cost of defense against lawsuits for damages and pays the expense of the defense also.
Effective July 1, 2020, Michigan No-Fault limits
- 50,000 per person for an injury occurs or if someone dies from the accident
- 100,000 for each accident if several people are injured or killed
- 10,000 for property damage in another state
The state will recommend that you carry limits of 250/500 and if you choose any limits that are lower you will have to sign a form acknowledging the risk of the lower limits.
Michigan No-Fault: Property Protection Insurance (PPI) coverage
No-fault will pay up to $1 million for costs that you cause in Michigan to another party’s property, such as a parked car, building, fence, or signpost. If the accident occurs out of state, the limits are from what you select from the property damage limit.
Michigan No-Fault: Personal Injury Protection (PIP) coverage
This part of the no-fault policy pays all necessary medical costs if an injury is the result of an auto accident. Michigan is the only state in the country that offers unlimited medical. Michigan adds an assessment (MCCA) to all Michigan drivers’ policies that will be going down on July 1, 2020. More information on the different choices can be found on the highlighted link for PIP selection.
Lost wages will pay if you are unable to work due to accident-related injuries. PIP will pay up to 85% of your gross income for up to 3 years. This limit varies according to your salary, and the state sets the payout limits. As of 2020, this limit was ($5718) this figure updates every October.
Survivors’ payments is an amount that the survivor receives, an assessment of the claim determines the amount if the insured dies as a result of the car accident.
Funeral expenses PIP helps pay for the related funeral cost if the covered individual dies because of the car accident. This limit can range between $1750- $5000 depending on coverage.
Replacement services PIP will pay up to $20 per day for three years if you need help performing household duties due to accident-related injuries.
For more information on Michigan No-Fault Coverage
These are the minimum coverage needed for no fault in Michigan. Click the link if you would like to see a comprehensive description of Michigan Auto Insurance coverage.