April 26, 2022
Michigan Auto Law 101: What Is No Fault Insurance?
Michigan is one of a dozen US states that requires no-fault insurance. But what exactly does this mean? The principle behind no-fault insurance is to lower the overall cost of insurance by requiring policy holders to file claims with their own insurance companies.
How does this lower costs? Well, “traditional” auto insurance requires a determination of who was at fault for the accident. This means that even some of the most simple or “small” claims can make it into the court system for a formal decision. Once it is determined who is at fault, that individual’s insurance company then pays out the claim. As you can probably image, this can create a significant amount of backlog in the system, which then increases costs for insurance companies and policy holders.
Policy holders with no-fault insurance in Michigan can file a claim after an accident and receive coverage for medical bills, property damages (your vehicle, damage to other property involved, etc.), wage losses, and replacement services. This covers any additional assistance you might need (within a given of scope of time) to take care of necessary tasks such as household chores and grocery shopping during the recovery period immediately after an accident.
Michigan’s No-Fault Laws and No-Fault Coverage
In the state of Michigan, it is against the law to drive a vehicle (that is registered in Michigan) without no-fault insurance. It doesn’t matter whether or not you, the owner, is the person who is actively driving the vehicle or not. However, your no-fault insurance will cover every member of your family that is registered in your household.
It’s also important to keep in mind that just because the insurance is called “no-fault” doesn’t mean that the police cannot find someone at fault. It is within the discretion of the police to write a ticket to the person they identify as responsible for an accident. This cost is entirely separate from insurance.
To meet the state’s insurance requirements, you must have a minimum amount of coverage in a variety of areas. For starters, your no-fault insurance policy must include Personal Injury Protection (PIP), Property Protection (PPI), and Residual Liability Insurance – Bodily Injury and Property Damage.
Should you be taken to court and found legally responsible for the accident, your insurance will cover up to the following amounts:
- $10,000 for property damage that occurred out-of-state
- $20,000 for the injury or death of another individual in the accident
- $40,000 per accident (vehicle) if multiple people are hurt or killed
These are the minimum coverages required by a no-fault insurance policy in Michigan. However, you always have the option to adjust the level of coverage as desired so long as you meet these minimums.
Car Accident Lawsuits in Michigan
If you are the victim of a car accident in Michigan, you can use our free Elia & Ponto Car Accident Checklist while at the scene of the accident. If necessary, you can file a third-party claim in the court system that goes outside the bounds of no-fault insurance. If the accused is found to be at fault for your accident and guilty of the charges, you can win money for losses that are not directly related to costs incurred as a result of the accident. For example, you may be awarded money for “pain and suffering” as a result of the trauma caused by the accident.
To find out if this is the right path for you, consult with an attorney as soon as possible. Our talented team at Elia and Ponto is here to help, and there’s no consultation fee. Call to talk to one of our experienced attorneys to see if a car accident lawsuit is the right move for you, or if there are other options to help you recover from your accident. Don’t wait – call today.