Understanding Michigan No-Fault: What Bills Are Covered?

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car accident no fault system

Motor vehicle accidents can have tremendous financial consequences, especially when someone is seriously hurt. Michigan’s no-fault auto insurance is designed to help injured people get the money they need. But how do you know which bills are covered by insurance? Let Christensen Law explain.

Michigan no-fault claims are divided into two types: First-party claims against your insurance provider and third-party claims against the at-fault driver and/or their insurer.

First-party Claims

After a car accident, your first source of compensation will come from your own insurance company, even if the crash is someone else’s fault. These are called your first-party or PIP benefits.

PIP benefits cover:

  • Accident-related medical expenses, such as doctor’s visits, surgeries, hospitalizations, diagnostic procedures, X-rays, home modifications, and prescription medications
  • Mileage for transportation to and from doctor’s appointments
  • A portion of your lost wages, if your injuries prevent you from working
  • Replacement services, which cover the cost for someone to assist with the daily tasks that you can no longer do, such as housekeeping, child care, yard maintenance, and cooking.
  • Attendant care, for caregivers to assist with personal tasks, such as bathing, dressing, toileting, and administering medications. These services can be provided through family members or in facilities. If your caregivers are family members who provide attendant care at home, PIP benefits will pay for no more than 56 hours per week.
  • Survivor’s loss benefits, if you pass away from your injuries and leave behind eligible dependents

Keep in mind that PIP benefits will be subject to your auto insurance policy limits. Until recently, Michigan motorists were required to carry unlimited coverage. Now, they can choose to continue with unlimited coverage or opt for smaller limits: $50,000 for Medicaid recipients, $250,000, or $500,000. If you exhaust your policy limits and still have excess medical expenses, you may be entitled to sue the other driver through a third-party claim.

Third-party Claims

In Michigan, seriously injured victims may be eligible to seek compensation through a personal injury lawsuit against the at-fault party and their insurer.

To file a valid third-party claim, you must prove that you suffered an injury that meets the state’s serious injury threshold. In other words, your injury must have resulted in a “serious impairment of body function,” “permanent serious disfigurement,” or death. If you meet those criteria, you may be able to get additional money. A third-party lawsuit can provide money for:

  • Excess medical expenses and wage loss beyond those covered by your PIP benefits
  • Wrongful death, pain and suffering, and disfigurement
  • Up to $1,000 toward the deductible for damage to your vehicle

It’s important to note that you can only recover compensation from a third-party claim if you can prove you were less than 50 percent responsible for the accident that injured you. Being assigned even a single percentage point more than 50 percent wipes out your ability to receive any compensation whatsoever for pain and suffering. With so much on the line, it’s vital to work with an experienced car accident attorney who can defend you against unfair claims of fault and insist that you are fully compensated for your losses.

Contact Christensen Law Today

It’s not easy to know what expenses you will incur after a serious car accident in Michigan. Talking to someone with a thorough understanding of Michigan no-fault insurance laws is essential so that you can maximize your compensation. Reach out to Christensen Law today. Our team of trusted car accident lawyers can assist you throughout every stage of the claims process.

At our firm, we prepare every case as if it’s going to trial. That way, we’re prepared to file a lawsuit quickly if settlement negotiations break down. We know how important it is to get your money as soon as possible. It’s our priority, too.

Call or contact us today for a free consultation with a proven no-fault accident lawyer.

This post was originally published in March 2014 and has been updated for accuracy and comprehensiveness in July 2021.