Michigan law requires that no-fault be taken. You must have certain coverage in order to register your vehicle.
There are three parts to the basic No fault insurance:
Bodily Injury/Property Damage (BI/PD).
The first section covers bodily injury and damage. This coverage will protect your assets and you if you are sued for an auto accident. Michigan law allows you to sue if your vehicle injures another driver, passenger, or pedestrian. This coverage covers you for any damages, defense costs, and the liability limit.
These are the minimum requirements of the state:
- $20,000 for each person who is injured or killed in an accident
- If multiple people are injured or killed in an accident, $40,000
- $10,000 for property damage in a different state
These limits are often indicated as 20/40/10. A judge could grant access to these limits if you are sued. This will depend on how severe the accident was and what assets you have. It is recommended to have higher liability limits than what is required. Talk to a Michigan agent about your options. Usually, these limits are as high as 1,000,000/1,000,000/1 million.
Property Protection Insurance (PPI).
No-Fault will cover up to $1,000,000 for damage you cause to property in Michigan. This includes damages to a parked vehicle, building, fence, sign post, or fence. The property damage limit you have selected will determine what limits apply if the damage was caused outside of Michigan.
Personal Injury Protection (PIP).
If you are injured in an auto accident, this part of the no-fault insurance pays all medical expenses. Michigan is the only state that provides unlimited medical coverage. Michigan can do this by adding an assessment (MCCA), to all Michigan driver’s policies, as of 2010. This.fee was $124.89.
If you are disabled from work because of an accident, lost wages will be paid. PIP can pay up to 15% of your gross income over a period of up to three years. The maximum amount of coverage depends on your salary. It is limited to the maximum payout limit set by the state in 2010. This was ($4878). This figure is updated each October.
Survivors’ payments: This is an amount that can go to the survivor, based on the claim assessment.
Funeral expenses PIP pays for funeral costs if the insured person dies in an accident. The maximum amount allowed is $1750 per person.
If you require assistance with household chores or other tasks because of an accident-related injury, PIP will pay $20 per day for three years.
These coverages are required by law for all Michigan vehicles. You can purchase optional coverage if you need coverage for vehicle damage.
Collision coverage pays to replace or repair your vehicle after it has been damaged in an accident. Michigan offers three types of collision coverage. The coverage will cover the damage as long as it doesn’t exceed the car’s actual cash worth. (Actual Cash Value is the car’s original purchase cost minus any depreciation.
- Standard collision covers damages without regard to fault. If you are at fault, you will need to pay a deductible.
- Broad form collision covers damages, regardless of fault. If you are more than 50% at fault, you won’t have to pay the deductable
- A deductible applies if there is a limited collision. This depends on whether you had one with this option. You are not responsible if you are more that 50%.
Comprehensive coverage (sometimes referred to as other than collision by insurance companies) covers damage that is not caused by a collision, such as theft, glass damage or fire, vandalism and explosions, hail, and contact with birds or other animals.
If your vehicle is leased, financed or otherwise, the finance company will usually require collision and comprehensive coverage. They will usually also insist that your deductibles not exceed $500.
You can also purchase optional liability coverage
Uninsured Motorist Bodily Injuries (UM)
Uninsured motorist coverage, an optional liability coverage, compensates you for excessive wage loss and pain and suffer. This coverage is only available if you are hit by a hit-and-run driver or uninsured motorist. These limits are usually the same as your bodily injuries limits. However, some companies offer coverage at the minimum state requirement.
Limited Property Damage (LPD).
Michigan law allows you to sue for damages not covered under the collision coverage of another person if you are more than 50% at fault for an accident. Mini-tort is another name for this coverage. This coverage will cover up to $500 for collision coverage.
Rent-a-Car Coverage
This optional coverage will pay a daily amount towards a rental vehicle if your vehicle is in need of repair. The coverage is typically limited to a certain amount and you’ll be responsible for any excess.
Emergency Road Service
This optional coverage pays for the cost of towing your vehicle or emergency services, such as vehicle lockouts and running out gas.
