How Does Personal Injury Protection (PIP) Work in Michigan?
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In Michigan, all drivers must carry personal injury protection coverage, sometimes called "no-fault" insurance. It's used to cover a driver's medical bills after a car accident, no matter who was at fault.
As of July 2, 2020, auto insurance reform to Michigan's personal injury protection (PIP) requirements went into effect. Michigan no longer mandates unlimited PIP, and drivers may be able to save on their car insurance as a result.
How much PIP coverage is required in Michigan?
PIP insurance is required for most drivers in Michigan. While unlimited coverage used to be required, you can now choose how much PIP coverage you'd like to purchase:
Coverage level | Who is eligible to purchase? |
|---|---|
| Unlimited coverage for driver and passengers | All drivers |
| Up to $500,000 in coverage per person per accident | All drivers |
| Up to $250,000 in coverage per person per accident | All drivers. You may also exclude some or all of the drivers on your policy if you have a health insurance policy that covers auto injuries, with a deductible under $6,000. |
| Up to $50,000 in coverage per person per accident | Only drivers who are enrolled in Medicaid and meet additional eligibility requirements. |
| Opt-out with no PIP coverage | Only drivers who have Medicare parts A and B and meet additional eligibility requirements. |
If your health insurance plan covers car-accident injuries, you can choose to coordinate your car insurance coverage for a lower PIP premium. You would only need to use your PIP insurance for costs that your health insurance policy doesn't cover, so you may be able to choose a lower PIP limit.
What does PIP in Michigan cover?
PIP insurance helps pay for damages after a car accident, whether you're at fault or not. The Michigan no-fault provision consists of four parts: medical costs, economic benefits, death benefits and property protection insurance.
Medical costs
The following are eligible for a PIP claim:
- Medical services and medication
- Surgical services and hospital expenses
- Rehab costs
- Diagnostic services
- Ambulatory services
- Treatment in accordance with a recognized religion
Economic benefits
If you're disabled in a car accident, PIP will pay for your lost wages — up to three years or until you recover and go back to work. There are limitations, however. You can be paid 85% of your normal salary or a limit of $6,615 per month, whichever is smaller.
You also receive up to $20 per day to pay for tasks you would normally handle but cannot. For example, you can hire someone to do laundry, clean the house and shovel snow. However, there are limits on this benefit, so make sure to check with your insurer.
Death benefits
If a policyholder dies in a car accident, then PIP would pay for the funeral and burial expenses up to $5,000. The policyholder's dependents are also entitled to work-loss benefits with the same limits: 85% of the policyholder's normal wages or a limit of $6,615 per month.
Property protection insurance (PPI)
Unlike any other state, drivers are also required to have property protection insurance in Michigan. PPI will reimburse others for damage your car causes to a building, fence, wall or stationary car. The mandatory limit is $1 million for the entire policy.
How much does personal injury protection cost in Michigan?
Since the no-fault law changed in 2020, Michigan has required insurers to reduce statewide PIP medical premiums. However, Michigan still has the highest average cost for car insurance in the country. Therefore, we recommend comparing policies from multiple insurers to find the best quotes for coverage.
Furthermore, because Michigan doesn't allow drivers to sue for the cost of car repairs, you likely need collision coverage. This could also drive prices higher. We took a look at a few sample quotes for unlimited PIP policies with and without health insurance coordination.
Health care option | Type of driver | PIP price per year |
|---|---|---|
|
Coordinated | 42-year-old married man | $582 |
| 30-year-old single man | $414 | |
|
Noncoordinated | 42-year-old married man | $592 |
| 30-year-old single man | $422 |
Coordinating your health insurance with your PIP does save you a little money, but it seems to be negligible overall, at least for our sample drivers.
When and how to file a PIP claim in Michigan
Personal injury protection is straightforward: If you're injured in a car accident, then you're eligible to file a PIP claim. Unlike bodily injury liability and property damage liabilitycoverage, it doesn't matter who caused the accident.
Everyone in your household is also covered, whether they were injured in a car accident in a vehicle or as a pedestrian.
When filing a PIP claim, you will generally need to provide these forms:
- PIP application that you submit to your insurance company
- Physician's note detailing your injuries
- A lost wage verification form if you're seeking wage-loss benefits
Your insurance company doesn't have to pay for any expenses until they see a valid form of proof of injury. Once proof is submitted, however, your insurer has 30 days to make the payment. If they do not comply within those 30 days, they will be charged interest. As a patient, you have up to one year to file the claim.
Coordinated vs. noncoordinated Michigan personal injury protection
Like in other no-fault states, you may coordinate your health insurance with your PIP to help reduce costs. With a coordinated policy, PIP will pay for your wage loss while your health insurance pays for your medical bills. This move makes sense if your health insurance plan covers many services.
But some health insurance plans exclude coverage for car accidents. There are also different deductible limits to consider. You will have to weigh which option is more cost effective for you.