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Basic No-Fault Auto Insurance:
Personal Injury Protection (PIP)
This part of your Michigan no-fault policy pays all necessary medical costs if
you’re hurt in an auto accident. It also pays, up to a maximum amount, lost
wages for up to 3 years.
What's covered?
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Medical expenses – If you’re injured in an accident, PIP covers general medical
expenses. There’s no limit on payment of medical expenses arising from auto
accident-related injuries.
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Lost wages – If you’re unable to work due to accident-related injuries, PIP
helps you recover lost wages. The limit on this varies according to your
salary, and is limited to 85% of your gross income for 3 years.
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Replacement services – Should you need help performing household duties or
other tasks due to accident-related injuries, PIP also helps pay for such
necessary services. The limit on this is $20 per day for 3 years.
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Survivors’ payment – This amount varies and is subject to the assessment of the
loss suffered by survivors. This payment may additionally cover necessary
services required by survivors.
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Funeral expenses – If a covered individual dies from accident-related injuries,
PIP helps pay for related funeral expenses. The limit for funeral expenses is
$1,750 per person.
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PIP provides protection to the policyholder, spouse, resident relatives, and
passengers in the insured vehicle.
Excess Medical/Wage Loss
If no-fault benefits are combined with health or disability coverage, it is
referred to as "excess medical/wage loss." This combination can reduce your
Michigan auto insurance premium. However, some healthcare providers have
restrictions on coordinating no-fault benefits with auto insurance. For
example, Medicaid, Medicare, and some self-funded plans do not allow you to
coordinate with your PIP coverage.
Medical coverage
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Primary medical: Your no-fault PIP coverage is the primary coverage for your
medical expenses.
OR
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Excess medical: You elect to coordinate your PIP coverage with your health
insurance. Your no-fault PIP coverage is secondary to your health insurance. A
$300 deductible applies per accident when excess medical is selected.
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Work Loss Coverage
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Primary work loss: Loss of income is covered primarily by your PIP coverage.
OR
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Excess work loss: Your policy covers excess expenses beyond what your accident
or disability coverage pays out for loss of income benefits. A $300 deductible
applies per accident when excess work loss is selected.
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Work Loss Waiver
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Accepting the work loss waiver indicates that you're at least 60 years old and
not eligible to collect work loss benefits.
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Property Protection Insurance (PPI)
This no-fault coverage pays up to $1 million for car accident-related property
damage to other people’s property such as buildings and fences. It will also
pay for damages your car does to other people’s properly parked cars.
Residual Bodily Injury and Property Damage
Although the no-fault laws protect you from being sued in most situations,
there are certain exceptions. These coverages pay for defense costs and any
damages you are responsible for as a result of an accident, up to the limits of
your policy. The following are the circumstances under which you might use this
coverage:
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You cause an accident in Michigan in which someone is killed, seriously
injured, or permanently disfigured
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You’re involved in an accident in Michigan with a non-resident who is an
occupant of a motor vehicle not registered in Michigan
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You’re involved in an accident in another state
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You intentionally cause harm to someone
These coverages are intended to pay for property damage or injuries caused to a
third party when you’re deemed legally responsible for an accident.
How much protection does this coverage provide?
The minimum limits required are $20,000/$40,000 for bodily injury and $10,000
for property damage. These limits, often referred to as 20/40/10, provide a
maximum coverage of $20,000 for a person injured by you in an accident and a
total of $40,000 per accident. The limit for property damage is $10,000 per
accident.
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