Your PIP Choice
The biggest change for Michigan motorists under the recent amendments to the No-Fault law is that mandatory lifetime no-fault personal injury protection (PIP) insurance coverage has been replaced by a tiered system that allows individuals to opt-out or purchase as little as $50,000 worth of PIP coverage for medical expenses under certain circumstances. Other options include $250,000, $500,000, and No-Limit.
The most significant decision that Michigan drivers will make is selecting their level of PIP coverage:
OPTION 1 – NO LIMIT PIP OPTION – RECOMMENDED
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This option is the closest to what we all had under the former law. This option covers all reasonable expenses incurred for your care, recovery, and rehabilitation if you are injured in an auto collision. Under this Option the new law mandates premium reductions to be “an average of 10% or greater per vehicle.” These premium reductions are not guaranteed for each policyholder. This reduction only applies to the PIP portion of your insurance premium. Other portions of your premium may actually increase. The insurance company is only required to reduce its statewide average premium charges, meaning you may not get a break on your insurance premium.
OPTION 2 – $500,000 PIP OPTION
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This option only covers up to $500,000 incurred for your care, recovery, and rehabilitation. Under this option the new law mandates premium reductions to be “an average of 20% or greater per vehicle.” These premium reductions are not guaranteed for each policyholder. This reduction only applies to the PIP portion of your insurance premium. Other portions of your premium may actually increase. The insurance company is only required to reduce its statewide average premium charges, meaning you may not get a break on your insurance premium.
OPTION 3 – $250,000 PIP OPTION
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This option only covers up to $250,000 for your care, recovery, and rehabilitation. Under this option the new law mandates premium reductions to be “an average of 35% or greater per vehicle.” This reduction only applies to the PIP portion of your insurance premium. Other portions of your premium may actually increase. These premium reductions are not guaranteed for each policyholder. The insurance company is only required to reduce its statewide average premium charges, meaning you may not get a break on your insurance premium.
OPTION 4 – $50,000 PIP MEDICAID OPTION (LIMITED AVAILABILITY)
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This option is only available to persons covered under Medicaid and whose spouse and household relatives are also either on Medicaid, have other health insurance, or have other PIP coverage through a different policy. Under this option the new law mandates premium reductions to be “an average of 45% or greater per vehicle.” This reduction only applies to the PIP portion of your insurance premium. Other portions of your premium may actually increase. These premium reductions are not guaranteed for each policyholder. The insurance company is only required to reduce its statewide average premium charges, meaning you may not get a break on your insurance premium.
OPTION 5 – OPT OUT (LIMITED AVAILABILITY)
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This option is only available if you and your spouse and household relatives meet certain criteria including that you and household relatives are “qualified persons” under either Medicare Parts A and B or other qualifying health insurance policies narrowly defined in the No-Fault Act. If you select this option you will also have very strict notification requirements if you or any of your household relatives ever lose qualified health coverage.
(Edited from https://www.michiganjustice.org/?pg=MichiganNewAutoInsuranceLaw)
WE HIGHLY RECOMMEND OPTION 1 FOR MOST AUTOMOBILE OWNERS.
If you have any questions about car insurance or the Michigan No-Fault law, be sure to contact us. We have been specializing in No-Fault law ever since it was created in Michigan in 1973. No one knows Michigan No-Fault insurance or car accident law better than the attorneys at Atkinson Petruska Kozma Hart & Couture, PC.
Northern Michigan’s Most Trusted Legal Team for Over 50 Years