When to Hire No-Fault Lawyers in Michigan
Legally Reviewed and Edited by: Terry Cochran
New changes to the Michigan no-fault law went into effect in July 2020, meaning drivers can choose between different auto insurance options. The changes are part of an effort to lower Michigan’s exorbitant auto insurance premiums.
However, the changes make drivers more vulnerable if they experience a car accident. They may now find their insurance coverage comes up short for medical expenses, loss of income, and economic loss beyond their insurance limits.
The best time to contact a personal injury lawyer at Cochran, Kroll, & Associates, P.C. is right after your accident before filing your claim. We can help you answer any questions about Michigan’s no-fault system and negotiate with the insurance adjuster on your behalf. Your lawyer can hold the insurance company responsible for compensation for your injuries and damages.
What is Michigan’s No-Fault Insurance Law?
Michigan is one of 12 U.S. states (plus the District of Columbia and Puerto Rico) to have a no-fault law. This law states every car owner in Michigan must have minimum auto insurance coverage. It is illegal to drive or let your car be driven without no-fault insurance. It is a precondition for obtaining license plates.
The Michigan no-fault law means that if you are involved in a car accident, your own no-fault insurance pays for medical bills, coverage for loss of wages, replacement services, and property damage, no matter which driver is at fault. These do not, however, cover repairs to vehicle damage.
The no-fault insurance that car owners must have includes:
- Personal Injury Protection (PIP)
- Property Protection (PPI)
- Residual Liability Insurance, which covers bodily injury and bodily damage
If you don’t have a policy, the applicable insurance company is generally that of your spouse or a family member. If you don’t have any coverage at all, the Michigan Assigned Claims Plan assigns a no-fault insurance company to you when you apply for benefits.
What PIP benefits are covered under Michigan’s no-fault law?
The PIP coverage portion of an auto insurance policy entitles an injured person who was involved in a car accident to the following additional no-fault benefits:
- Medical care expenses (including physical therapy)
- Medical mileage (reimbursement for transportation costs to and from medical appointments)
- Wage losses
- Replacement services (paying for someone else to perform everyday household tasks, including chores, errands, and childcare)
- Allowable expenses such as attendant care (nursing care in the home)
- Home modifications
- Vehicle modifications (to accommodate accident-related physical limitations)
In the case of wrongful death, this coverage can also provide aid for burial and funeral expenses.
Why Did the Michigan No-Fault Insurance Law Change?
Next to the generous PIP benefits, the frequency of auto accident lawsuits and health care costs continued to rise, causing auto insurance costs to increase as well.
As a no-fault state, Michigan was the 2nd most expensive state in the United States for auto insurance in 2018, with an average of $1,469.73 per full auto insurance coverage. That’s over three times the national average.
What Are the Options Under Michigan’s No-Fault Insurance Today?
The no-fault auto insurance reform, signed into law in May 2019, is the most significant change to auto insurance law in Michigan’s history.
With the six PIP benefits to choose from and new coverage options for policies issued or renewed, insurance rates are set to be lower. The six options are:
- Option 1: Unlimited Coverage
- Option 2: Up to $500,000 in coverage
- Option 3: Up to $250,000 in coverage
- Option 4: Up to $250,000 in coverage with some or all vehicle users excluded from PIP medical coverage. People may qualify for this option if they have qualified health insurance coverage that doesn’t exclude auto injuries and have deductibles under $6,000
- Option 5: $50,000 in coverage if a person is enrolled in Medicaid
- Option 6: PIP Medical opt-out if a person has Medicare Parts A and B and meets other eligibility criteria
The state minimum is also increased for bodily injury, uninsured motorists, and underinsured motorists.
Under Michigan’s no-fault law, Medicare coverage pays after the limit of PIP coverage is surpassed. What it takes to surpass the PIP coverage depends on the level of coverage you choose when purchasing your insurance policy.
While PIP medical coverage is still the primary payer in an auto accident up to the fault coverage limit, Medicare coverage pays after you surpass this limit, leading to complications in recovering damages. A person with Medicare parts A, B, and C (Medicare Advantage) can choose to opt out of PIP coverage, in which case Medicare pays for everything.
Who Pays When an Auto Accident Occurs?
When a driver or passenger has suffered a personal injury or other damages in a motor vehicle accident in Michigan, a source of no-fault insurance will provide benefits according to “Order of Priority” rules outlined in Michigan’s no-fault law. These determine which auto insurance company has to pay according to the exact circumstances of the accident and what insurance arrangements a person has.
- First Priority: The no-fault insurer of the injured occupant of the vehicle
- Second Priority: The no-fault insurer of the spouse of the injured occupant of the vehicle
- Third Priority: The no-fault insurer of the injured occupant of the vehicle’s closest relative who resides with the injured occupant
- Fourth Priority: The Michigan Assigned Claims Plan
Different auto insurance companies pay for different types of accidents. For example, if they involve vehicles besides passenger cars, such as rental cars, motorcycles, or the accident involves pedestrians.
Vehicles in the business of transporting passengers order of priority
The driver or passenger of a motor vehicle in the business of transporting passengers injured in a car crash in Michigan must apply for no-fault benefits from the insurer of the motor vehicle.
These include public transportation, school buses, taxi cabs, company vehicles, such as those operated by ride-sharing services like Uber, and cars or trucks whose owners have opted out of no-fault PIP medical benefits after the changes to the law, or to which exclusions apply.
Employer-provided vehicles order of priority
According to the no-fault statute, in the event of an accident involving vehicles provided by an employer, the employer’s insurer must provide no-fault benefits.
Pedestrian accident order of priority
The no-fault order of priority for a pedestrian injured in a car accident is:
- First Priority: The pedestrian’s no-fault auto insurance policy.
- Second Priority: The pedestrian spouse’s no-fault auto insurance policy.
- Third Priority: The pedestrian’s resident relative’s no-fault auto insurance policy.
- Fourth Priority: The Michigan Assigned Claims Plan, if the pedestrian has no access to an auto insurance policy.
Motorcycle accident order of priority
The no-fault order of priority for motorcycles involved in an automobile accident in Michigan is:
- First Priority: The insurer of the owner or registrant of the motor vehicle in the accident.
- Second Priority: The insurer of the driver of the motor vehicle in the accident.
- Third Priority: The auto-insurer of the operator of the motorcycle.
- Fourth Priority: The auto-insurer of the owner or registrant of the motorcycle.
- Fifth Priority: The Michigan Assigned Claims Plan, if no motorcycle insurance is available to the injured motorcyclist.
Who is Eligible for No-Fault Benefits?
Any injured person suffering from a car accident in Michigan is eligible for no-fault PIP benefits, even if they are the family member or passenger of the owner or driver of a car or truck. A five-part test determines whether all the conditions are met for an injured person to receive the benefits.
The five questions that must be answered are:
- Is a motor vehicle involved in the accident?
- Did a bodily injury arise from the accident?
- Is the injury accidental?
- Is there a sufficient degree of causality between the ownership and use of a motor vehicle and an injury? This does not have to amount to absolute causality; the liability threshold of causality to be proven is 50%.
- Did the car qualify as a motor vehicle at the time of the accident?
According to the no-fault statute, you must file a no-fault application with your auto insurance provider, who can give you the relevant forms. There is a one-year statute of limitations from the date of your accident in Michigan.
Failing to file an application on time will result in you losing benefits related to the specific accident forever.
Who is Ineligible for No-Fault PIP Benefits?
There are several disqualifying actions for no-fault PIP benefits. These are if the accident occurred:
- While the victim was using a stolen vehicle.
- If the owner or registrant of the vehicle was not insured as required by the no-fault law.
- If the victim was not a Michigan resident driving a vehicle not registered in Michigan and not insured in Michigan.
- If the motor vehicle was excluded from insurance coverage because of an insurance company policy.
What Should I Do After a Car Accident in Michigan?
A car accident can be a very stressful event for anyone. After an accident, the first thing you should do is get your bearings and check for any injuries. Ask the other passengers in your car and the other driver if they need medical attention. If you can move, call the authorities immediately to file a police report and get medical treatment.
Collect as much information as possible. Ask the other driver for their contact information, insurance company, and insurance policy number. If there were witnesses to the accident, ask for their contact details as well. Take photos of the crash scene, and seek treatment from your primary medical providers.
Depending on the nature of the accident, you should contact an accident attorney at Cochran, Kroll & Associates, P.C., before filing the insurance claim. Your attorneys can give you legal advice about how to proceed with your claim based on your account of the accident. They may also negotiate with the insurance adjuster on your behalf to ensure you receive your benefits according to your insurance policy coverage and limits.
How Long Do I Have After a Michigan Accident to File a Lawsuit?
Consider filing a personal injury lawsuit if you believe you may be entitled to more money than your PIP insurance covers. The statute of limitations for filing in Michigan is three years from the date the accident occurred.
While your PIP insurance covers you, the changes to the auto-insurance law mean that you may only be covered up to a certain amount, depending on the option you chose.
You may have non-medical considerations that your PIP insurance option doesn’t address, such as pain and suffering or loss of quality of life. Filing a personal injury suit, also known as a third-party claim in Michigan, may be your only option to collect sufficient damages.
Serious car accidents can also result in the wrongful death of a family member. You may decide to file a wrongful death lawsuit against the negligent driver, which can also be applied to out-of-state motorists and uninsured at-fault drivers. The statute of limitations for a wrongful death lawsuit is also three years in Michigan.
The personal injury attorneys at Cochran, Kroll & Associates, P.C. have a strong track record and extensive experience securing settlements for individuals and families in Michigan involved in accidents with life-altering consequences. Where no-fault PIP may not cover the true extent of the damages for car accident victims, we can help you fight for what you deserve.
A Car Accident Lawyer Can Help You With Your Claim
If you or a loved one were car accident victims and believe your PIP auto-insurance coverage is insufficient to cover the damages, contact the law firm of Cochran, Kroll & Associates P.C., Our experienced attorneys can give you legal advice based on your case so you can pursue the best option for compensation.
Our contingency fee basis means we only get paid if we win your case, so there is no financial risk to you to get started. Call our law firm today at 1-866-MICH-LAW and schedule your no-obligation, free case evaluation.
How much is your Michigan car accident case worth?
Each case is unique, with its own set of factors determining the outcome. These factors include the severity of your injuries, the duration of your medical treatment, and financial losses such as medical expenses and loss of wages.
Can you sue a driver in Michigan after an accident?
If you were injured in a car accident in Michigan, you can bring a lawsuit for compensation for pain and suffering, just like in any other state. In Michigan, however, the injured driver must be able to prove they suffered impairment of bodily function due to the other driver’s negligence to qualify for non-economic damages.
Disclaimer : The information provided is general and not for legal advice. The blogs are not intended to provide legal counsel and no attorney-client relationship is created nor intended.