Understanding the Michigan No-Fault Auto Reform

Michigan is known for many things - its beautiful lakes, rich sports history, and pioneering the automobile industry, among many things. They're also known for being one of the 12 states in the U.S. that have no-fault auto insurance in place. 

Since 1973, all Michigan auto policies had to provide unlimited Personal Injury Protection medical coverage. This means that if you qualified for PIP benefits because you were hurt in an automobile accident, you could receive lifetime medical benefits for treatment related to your care, recovery, or rehabilitation. 

In May 2019, Michigan Governor Gretchen Whitmer signed a new law changing the way Michigan sees no-fault auto insurance that goes into effect July 2, 2020. 

What is changing?

If you live in Michigan, ultimately you now have a choice that could give you some savings when it comes to your auto insurance. While you can still choose to keep the unlimited Personal Injury Protection medical coverage that you're used to, you also have the opportunity to select from five additional options when your insurance policy renews: 

  • $500,000 of PIP medical coverage - covers auto accident medical expenses up to $500,000. 
  • $250,000 of PIP medical coverage - covers auto accident medical expenses up to $250,000. 
  • $250,000 of PIP medical coverage with PIP medical exclusion(s) - must meet eligibility requirements.
  • $50,000 of PIP medical coverage - covers auto accident medical expenses up to $50,000 - must meet eligibility requirements.
  • Opt-Out of PIP medical coverage - must meet eligibility requirements.
So what do you need to do?

While you won't need to take any action until it's time to renew your policy, there are plenty of things you can do to prepare in the meantime. 

Review your policy. The new law directly impacts your Personal Injury Protection medical coverage, but it's important to understand that it is just one of the coverages that are included in your auto insurance policy. Make sure you are familiar with all of your coverages and current limits to help you make an informed insurance decision. It's also a good idea to review what medical coverage is included by your personal health insurance for injuries sustained in an auto accident.

Talk with family. If you have a spouse or kids, you likely aren't the only one that's impacted by this new reform. Talk your plans over with your family so everyone understands the new coverage moving forward. 

Contact your agent. If you have questions, set up a time to meet with your independent agent before your policy renews. 

For more information on the Michigan No-Fault Auto Reform, visit our FAQ resource center.