Michigan Minimum Car Insurance Requirements
Purchasing insurance in the state of Michigan can get pretty pricey, pretty fast, and a lot of this has to do with just how much insurance you are required to carry. Michigan mandates all drivers carry three types of insurance: liability coverage, personal injury protection (PIP), and property protection insurance. Each of these insurance comes with its own mandatory minimum amounts:
- $50,000 bodily injury per person
- $100,000 bodily injury per accident
- $10,000 property damage per accident
Property Protection Insurance
- $1 million per accident
Personal injury protection (PIP) varies. Your coverage limit can range from $50,000 to $500,000, depending on your situation. You could even get unlimited PIP coverage or opt-out of it completely if eligible.
Failure to comply with these car insurance laws can result in you facing some serious penalties. You should also be aware of the fact that if you have an auto loan or are leasing your vehicle, your lender or leasing company may require you to carry additional car insurance.
Michigan No-Fault Insurance Laws
Michigan is one of the few that’s that has a no-fault insurance law system in place. What this means is that in an accident, no matter who was deemed responsible for it, each driver will file claims with their own insurance policy. In theory, this helps prevent drivers from suing one another or arguing further than what is necessary. Where this can really help you is that you do not have to wait as long to get medical expenses carried as, theoretically, your insurance company should be covering all the claims.
If you are injured to the point you need a caretaker, insurance can help pay for this, but as of July of 2021, the rules have been adjusted. Michigan’s new no-fault laws state that insurance companies only have to pay for 56 hours per week for in-home care. Reimbursement for rehabilitation provides has also been adjusted.
Michigan Liability Insurance
Liability insurance is required in many states, including Michigan. It covers damages you cause to another drive when you are found to be responsible for the accident. This insurance is broken into two different parts: bodily injuries and property damage. While Michigan is a no-fault state, liability insurance can still come in handy if you are involved in an accident outside the state or if injuries sustained in an accident are severe enough. It is important to remember that liability insurance will never cover you and your passenger(s).
Property Protection Insurance in Michigan
Potentially a unique aspect of Michigan insurance requirements is the addition of property protection insurance. Property protection insurance pays for damages you cause to fixed objects. This can include things like road signs and fences. Michigan requires you to carry quite a bit of such protection. It is also important to note that property protection insurance never applies to other vehicles involved in the accident unless they are parked.
Michigan Personal Injury Protection (PIP)
Personal injury protection (PIP) helps cover medical expenses for you and your passenger(s) after an accident. It can sometimes work in coordination with your current health insurance policy. Due to Michigan being a no-fault state, it would be wise to carry a significant amount of PIP coverage. Your only real chance of getting money from the other driver’s insurance company is if your injuries include permanent disfigurement or the development of a disability. Death, too, can also be grounds for suing. But you are better off not risking it.
In July of 2020, Michigan altered its reformed no-fault law, which adjusted the amounts of PIP coverage you can choose from. As touched on briefly before, your options for PIP coverage range from $50,000 to $500,000. There is also an option for unlimited coverage, or you can opt out if your health care plan makes you eligible to do so.
Car Insurance Limits in Michigan
When it comes to car insurance, coverage limits refer to the maximum amount of money your insurance company will pay in the event of a claim. Limits also are determined by the state and outline the lowest amount of insurance you can carry to be a legal driver. In the state of Michigan, mandatory minimum liability insurance coverage is 50/100/10 with each of these numbers representing a different aspect of liability coverage:
- Bodily injury per person is the maximum amount your insurance company will pay for injuries to one person in an accident you caused.
- Bodily injury per accident is how much your insurer will pay out for all injuries you cause in an accident.
- Property damage per accident is the amount of money your insurer will pay for damage to property you cause in an accident.
PIP coverage and property protection insurance come with their own requirements and recommendations as having been outlined in previous sections.
Is Michigan’s Mandatory Insurance Minimums Enough Coverage?
The state of Michigan has some pretty ambitious car insurance requirements. While you may think by carrying the state-mandated minimum, you are fully protected, that may not always be the case. For example, if you carry $250,000 in PIP coverage, you could easily exceed that depending on the severity of your injuries and who all was involved in the accident. Remember, the limit covers you and your passenger(s). While it is not fun to prepare for the worst, it can be worth it. It is always highly recommended that when you go to buy car insurance, you increase coverage limits and consider policy add-ons in order to keep yourself and your assets protected.
Driving Without Proof of Insurance in Michigan
Failure to provide proof of insurance in the state of Michigan will result in you getting charged with a misdemeanor. On top of that, you could also be facing the following penalties:
- A fine ranging anywhere from $200 to $500
- License suspension
- Up to 1 year in jail time
- Any associated court fees
Additional Types of Car Insurance in Michigan
While the state of Michigan mandates drivers to carry a few different types of car insurance, you will always have the chance to expand your policy. Listed below are some common policy add-ons you can use to strengthen your car insurance coverage.
- Collision: Thie coverage pays for damages to your car that are caused by an accident with another vehicle.
- Comprehensive: This covers damages to your car that are non-collision-related. Some incidents this coverage includes are theft and extreme weather.
- Rental Car Reimbursement: If your car is out of commission due to an accident, this coverage can help cover the costs associated with renting a vehicle until yours is able to be driven again.
- Gap Coverage: If your car is totaled before you are able to pay off your auto loan, gap coverage can pick up the difference between your vehicle’s actual cash value and the remaining amount on your loan.
- Roadside Assistance: Many insurance companies offer roadside assistance, which can help you when your car has some mechanical issues, such as a dead car battery.
- Uninsured Motorist Coverage: Despite car insurance being mandatory, many choose to drive without any coverage. If you end up in an accident with one, uninsured motorist coverage can help pay for damages and injuries.
Car Insurance is Important For Any Michigan Driver
Car insurance is a very vital thing to carry. Not only does it help keep you within the law, but it also offers you valuable protection. Accidents can be detrimental to you and your finances. Insurance is able to relieve some of the stress following an accident, but only if you have an adequate amount of it. Carrying strictly Michigan’s mandatory minimum may not always be sufficient. You should consider increasing limits and expanding insurance through policy add-ons to make sure you and your assets are fully protected.
*This product may not be available in every state, please call an agent for more information.