Michigan No-Fault Insurance Requirements
Michigan requires all motor vehicle drivers to have a minimum liability insurance coverage for any car that is registered in the state. Driving without this basic insurance, or letting someone drive an uninsured vehicle is a misdemeanor crime that is punishable by fine and even jail time.
There are three parts to a basic no-fault insurance policy; Personal Injury Protection, Property protection Insurance, and Bodily Injury and Property Damage Liability Insurance.
- Personal Injury Protection (PIP) will pay all your medical expenses if you are injured in a motor vehicle accident no matter who is at fault for the crash.
- Property Protection Insurance (PPI) will pay property damaged caused by you. It would pay for damage to someone else’s vehicle only if the vehicle was properly parked.
- Bodily Injury and Property Damage pays legal fees and damages if you are determined to be at fault for any accident that occurs in another state or is caused by a driver from another state, or if your accident seriously injures or kills someone, or for damages that are not otherwise covered by insurance.
Michigan’s Minimum Insurance Amounts
You must have a minimum coverage of 20/40/10 which is –
- $20,000 for a person who is killed or injured in an accident you cause
- $40,000 per accident for all persons injured or killed in an accident caused by you
- $10,000 for property damage you cause in another state
Be aware that if you cause a serious accident, you could be legally responsible for costs above your insurance liability limits. For example, a person is severely injured in an accident that you caused. The victim’s medical bills and expenses are expected to reach more than $60,000. However, you only have the basic coverage limits, so your insurance will only pay the first $20,000. The law says you are responsible for paying the other $40,000 in expenses.
However, your no-fault policy will provide you with unlimited benefits to cover your medical expenses, as well as wages lost benefits. It will not pay to repair your vehicle or the vehicle of another person no matter who caused the accident, not will it provide protection against mini-torts.
Who Pays for Damage to Your Vehicle?
Your no-fault insurance does not pay for vehicle repairs, nor will it pay for a replacement vehicle if your car is totaled. For these situations, you need comprehensive and collision coverage.
Collision coverage will pay to repair or replace your vehicle if it is damaged in a crash. In Michigan, you can get Limited Collision Coverage, Broad Collision Coverage, Limited Collision with Deductible, and Standard Collision –
- Limited Collision Coverage will repair your vehicle after a crash if you are less than 50 percent responsible
- Broad Collisions Coverage will repair your vehicle no matter who is at fault for the accident. However, if you are more than 50 percent responsible for the damage, you will pay a deductible, but if you are less than 50 percent responsible, you pay not deductible
- Limited Collision with Deductible will fix your vehicle if you are 50 percent or less responsible for the accident, but you will pay a deductible. You receive no benefits if you are more than 50 percent liable
- Standard Collision pays to repair your vehicle no matter who is at fault, but you will always pay a deductible
Comprehensive coverage pays for non-collision damage to your vehicle, such as if you hit an animal, or your vehicle is damaged in a flood or crushed by a fallen tree. You will pay a deductible, and the lower your deductible, the less expensive this type of coverage.
Uninsured Motorist Coverage is another option you should consider. It will pay if you are hit by a driver who does not have insurance. It will pay for your financial losses and non-economic damages like pain and suffering.
Mini-Tort Limited Property Damage Liability is offered by some insurance companies to cover damage expenses in cases where the victim of an accident does not have collision insurance, and you are 50 percent or more at-fault for property damage.