Michigan’s unique no-fault auto insurance system saw some serious changes starting July 1, 2020. Drivers across the state had some important choices to make on their insurance coverage, which could mean adjustments to both personal injury protection (PIP) and liability coverage. Some have touted the changes as a way for drivers to save money on their auto insurance premiums. However, these choices will dramatically reduce the care most accident victims have access to in the event of a crash. The changes will also make way for lawsuits that could go beyond insurers and hit at-fault drivers personally.
Let’s start with the basics. Michigan drivers have two types of coverage that we’ve had since 1974, when our no-fault system was created:
- Liability coverage: This type of coverage protects us in case we injure somebody else, and that person makes a claim against us. This coverage compensates the victim for the injuries that we caused. So if you get sued, that liability coverage protects you and your assets.
- Personal injury protection: This coverage protects you if you get hurt in a car accident. It pays your medical bills, your lost wages up to a limit, hospital stays, physical therapy, and any help that you might need as a result of the accident. PIP coverage is very broad and includes any type of treatment care accommodation that you need due to your injuries.
Up until July 1, 2020, PIP coverage had no limit: It covered you for life. Well, that is changing.
Now, you are able to buy less coverage if you think that is the best thing for you and your family. You can continue to buy the unlimited coverage, but you can also buy smaller denominations of personal injury coverage. This change in PIP coverage will also affect your need for liability coverage.
At Christensen Law, we want to make sure drivers understand how these new insurance choices could impact you and your family in the event of an accident. Below are some of the frequently asked questions we are hearing from people across Michigan.
