As a resident and vehicle owner in the state of MI you are required, by law, to carry basic coverages on a vehicle registered in MI.
The 3 basic coverages are:
Personal Injury Protection (PIP)- This covers all reasonably necessary medical expenses incurred in an auto accident, with no max limit. This coverage would be used for emergency medical attention, surgery, medications, physical therapy or anything else deemed medically necessary because of an auto accident. It will also cover any wages lost due to an auto accident and up to $20 per day for replacement services like housekeeping or yard work if you are unable to perform these tasks due to injuries sustained in an auto accident.
Property Protection (PPI)-This will pay up to $1 million for damages your vehicle causes to another person’s property in Michigan. For instance, if you hit a parked car or lose control and hit a guardrail.
Residual Liability-Bodily Injury- This portion of the No Fault protects an insured from being sued because of an auto accident except in special situations. A few examples of what you could be sued for are if you cause an accident in which someone is killed, seriously injured or permanently disfigured, if you are in an accident with a vehicle that is not registered in MI and the occupants are non-MI residents or if you are more than 50% at fault for an accident in which the other party involved is not covered by insurance.
Property Damage-works just like the Property Protection except it pays for damages caused in another state.
The minimum requirements by law for Residual Liability-Bodily Injury and Property Damage (BI PD) are
Up to $20,000 for a person who is hurt or killed in an accident
Up to $40,000 for each accident if several people are hurt or killed
Up to $10,000 for property damage in another state
Another part of Michigan No Fault Insurance is the fees that are paid to the Michigan Catastrophic Claims Association or MCCA.
100% of the MCCA fees collected by EVERY insurance company in the state of Michigan are paid directly to the state. These fees are collected on EVERY vehicle registered and insured in MI every year. As of July 1, 2018, the MCCA fee per vehicle will be $192.00 a year. The MCCA assessment is used to reimburse insurance companies for PIP benefits paid in excess of $555,000 per claim. For example, Henry is in an accident he sustained serious injuries that required air lift, surgery, physical therapy, and a prosthetic leg. His auto insurance company pays for all these items. So far, the total has reached $655,000. The state of Michigan jumps in and takes a portion of the MCCA fees they have collected and reimburses the insurance company for the $100,000 over and will continue to do that as long as Henry needs medical services directly related to his injuries incurred in the accident.
In 2017 the MCCA paid out $1.2 billion for claim costs resulting from catastrophic injuries. That is $160 per insured vehicle. Costs for the MCCA has increased consistently since it’s inception in 1978, due to the unique MI No-Fault insurance law that provides unlimited lifetime medical expenses resulting from an auto accident, increasing number of individuals that are receiving benefits and the continued rise in medical care costs.
For additional information regarding the MCCA fee click here.
If you are one of the thousands of MI residents that would like to see a change in the MI No-Fault Insurance, please contact the following individuals:
Lana Theis lanatheis@house.mi.gov
Sara Cambensy saracambensy@house.mi.gov
Beau LaFave beaulafave@house.mi.gov
Scott Dianda scottdianda@house.mi.gov