Car accidents are common in Michigan, and almost 61,000 people suffered injuries in crashes in one recent year. Collisions can happen in residential areas, urban intersections, or on major highways like I-75. No matter where a crash occurs, you should learn about your rights under Michigan law to seek auto insurance benefits.
Michigan follows no-fault insurance principles, and lawmakers recently overhauled the no-fault car insurance system. These changes altered how car accident victims seek compensation for their medical bills and other losses.
The changes to long-standing insurance requirements in our state can confuse consumers. The Michigan car accident lawyers at Michigan Injury Lawyers have experience litigating first-party and third-party claims under the no-fault laws. We know how to help clients adapt and take action under the new law.
We are skilled negotiators with insurance companies and aggressive advocates in the courtroom. We work tirelessly on behalf of our clients to secure the most favorable settlement or verdict. If there is no recovery in your case, there is no fee for our services. Contact us today for more information.
Michigan No-Fault Insurance Overview
Michigan enacted its No-Fault Insurance Act in 1973 with two goals in mind: making Michigan automobile accident victims whole and keeping insurance premiums at reasonable rates.
This no-fault law required drivers to carry unlimited personal injury protection (PIP) coverage, which provides unlimited benefits for medical care and other losses stemming from car accident-related injuries, no matter who was at fault for the crash. This largely eliminated the need for claims or lawsuits against other drivers, except to seek pain and suffering damages in certain cases.
However, as time passed and medical care became significantly more expensive, insurance companies regularly raised premiums to pass costs on to consumers. To resolve this matter, the legislature updated the no-fault laws in Michigan, and these new provisions went into effect in July 2020. Under the new law, it is more common for car accident victims to file claims or lawsuits against drivers who were responsible for causing accidents.
First-Party Claims
Michigan law still requires that you purchase no-fault insurance unless you qualify for a strict exception to opt out entirely. In exchange for purchasing coverage, no-fault insurance provides first-party personal protection (PIP) benefits. This coverage entitles an insured to medical expenses, wage losses (up to a certain amount), survivor’s losses (in cases of death), and replacement services—regardless of who was at fault.
Having to only deal with your own insurance company instead of another driver’s insurer might be a relief. However, you might be surprised how many issues can arise between a PIP policyholder and their insurance company.
For example, in some circumstances, the insurer may set off or reduce the amount it pays an insured when other coverage is available for the same vehicle accident. These set-offs can occur when the insured qualifies for benefits under state and federal programs, such as workers’ compensation or Social Security disability and survivor’s benefits.
In some cases, the insured may choose to coordinate benefits with the auto insurance company and providers of other health and accident coverage. In exchange for the insured paying a reduced premium, the auto insurance company will offer deductibles and benefits exclusions. The insured purchases limited no-fault coverage that only covers benefits that other parties do not provide.
Coordinated coverage, however, can frequently lead to disputes. The no-fault insurance carrier is no longer the primary source of benefits when someone purchases coordinated coverage. That means the insured must first look at his or her other health or accident policies.
Frequently, there can be disagreement over which policy is the primary one, especially when there is a health plan under the Employee Retirement Income Security Act (ERISA).
If you have a first-party insurance claim, you can face challenges whether or not you have coordinated benefits. Even a seemingly straightforward claim with your PIP coverage can result in delays, disputes, or denials from your insurance company.
Never hesitate to seek legal help with a first-party claim. Our attorneys are your advocates to the insurer, and we fight for the benefits you need following a car accident and injuries.
Third-Party Claims
Mandatory unlimited PIP coverage reduced the need for many car accident lawsuits. Now, however, drivers have options regarding their PIP coverage. You can keep your unlimited coverage, or you can choose a PIP policy with limits of $500,000, $250,000, or even lower if you meet certain criteria. Choosing a limited PIP policy might mean you need to file a third-party claim against the at-fault driver if your medical expenses and other losses exceed your policy limits.
Even if you have an unlimited PIP policy, a Michigan car accident victim might need to seek benefits through a third-party claim for pain and suffering and other non-economic losses. To prevail in this type of claim, the party must show that the other driver was at fault and that they meet the “threshold requirement.”
The threshold requirement has triggered extensive litigation in recent years. An injured person can generally meet the requirement if they suffered death, permanent serious disfigurement, or serious impairment of a body function, which the law defines as “an objectively manifested impairment of an important body function that affects the person’s general ability to lead his or her normal life.”
A recent Michigan Supreme Court decision clarified that to show impairment, a victim does not need to show that the injury altered the course or trajectory of the victim’s life.
A car accident victim may raise a third-party claim without meeting the threshold requirement in situations where:
- The victim claims economic losses that exceed the statutory maximums, such as income losses that extend beyond three years;
- A maximum of $500 for vehicle damage if the damage was an uninsured loss under the mini-tort provision and the other driver is at fault;
- Full damages (pain and suffering, lost income, medical expenses, funeral costs) if the injury did not arise out of the defendant’s ownership, operation, maintenance, or use of a motor vehicle, such as malpractice, premises liability, or product liability claims;
- Full damages (including economic losses) if the defendant is uninsured or operating a motorcycle, which are situations where the defendant is not entitled to protection under no-fault laws;
- Full damages may also be available if the accident occurs out of state, to the extent allowed under the law of that state.
Meeting the threshold or qualifying for an exception are complex matters. Most people have no idea whether they might be eligible to file a third-party claim, which is where our legal team comes in.
We can evaluate your circumstances, including your first-party coverage, liability for your injuries, and your losses, to advise you if you have a third-party claim. If so, we handle every step of the process to seek compensation from all possible sources of third-party liability.
Contact a Michigan Car Accident Lawyer
Because both first-party and third-party auto accident claims can be complex, it helps to work with the skilled and experienced personal injury attorneys at Michigan Injury Lawyers. We believe in finding solutions for our clients through alternative dispute resolution, such as mediation, but we will always be ready to go to trial. If there is no recovery in your case, there is no fee for our services.
Call the Michigan Injury Lawyers at (888) 454-0801 or contact us online for an evaluation of your claim.
Michigan Office
2525 S Telegraph Rd, Ste 100
Bloomfield Hills, MI 48302