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Michigan Mini Tort to rise to $1,000 deductible

New House Bill 5362 proposes doubling car damage coverage limit but disqualifying uninsured vehicles

Big changes appear to be on the horizon for Michigan’s Mini Tort law, courtesy of a House Bill that’s speeding through the Michigan Legislature.

Introduced on February 7, 2012, by Rep. Cindy Denby, and presented to Gov. Rick Snyder for his review on May 29, 2012, House Bill 5362 proposes two major changes to the Michigan law, which forces negligent drivers to pay for the vehicle damage they cause:

  1. The legislation will increase the Mini Tort coverage limit from $500 to $1,000.
  2. The legislation will disqualify uninsured vehicles from all coverage under the Mini Tort law.

Michigan’s existing Mini Tort Law

Under Michigan’s Mini Tort law, an auto accident victim is entitled to recover a maximum of $500 from an “at fault” driver to cover vehicle damage repair costs. (MCL 500.3135(3)(e), (4), (5) and (6))

Consequently, the Mini Tort law has both a remedial and protective nature:

  • It allows the auto accident victims to recover up to $500 to put towards vehicle damage repair costs; and,
  • It allows the “at fault” driver to limit her liability for vehicle damage to $500.

Additionally, Mini Tort coverage applies regardless of whether the damaged vehicle is covered by a No Fault auto insurance policy.

Proposed changes to the Mini Tort Law

As stated above, the primary change to Michigan’s Mini Tort law proposed in House Bill 5362 is increasing the Mini Tort coverage limit from $500 to $1,000.

Another significant change is the insurance issue.

Specifically, the owners and registrants of uninsured vehicles would be disqualified from using the Mini Tort law to pay for vehicle damage caused by an “at fault” driver.

House Bill 5362 proposes amending the existing statute to include the following language: “Damages shall not be assessed if the damaged motor vehicle was being operated at the time of the damage without the security required by Section 3101.”

MCL 500.3101 of the Michigan No Fault law requires all vehicle owners and/or registrants to secure No Fault auto insurance for their vehicles.

Comparative fault

Notably, HB 5362 proposes no changes to the Mini Tort law’s existing comparative fault rule.

Accordingly, even if House Bill 5362 is passed, Mini Tort coverage will continue to be reduced by a driver’s percentage of fault.

For instance, if a driver is 25 percent at fault and the damage to her vehicle is $100, then the most she can recover under the Mini Tort law is $75.

However, if the driver is “more than 50% at fault,” then she will be disqualified from all Mini Tort coverage. (MCL 500.3135(4)(a))

– Steve Gursten is one of the nation’s top insurance attorneys handling auto accident lawsuits. He is head of Michigan Auto Law and president of the Motor Vehicle Trial Lawyers Association. Steve frequently writes and speaks about Michigan No-Fault law and auto insurance, and is available for comment.

– Photo courtesy of Creative Commons, by Uriel 1998

Related information to protect yourselves:

Michigan Mini Tort FAQs

Mini Tort sample letter

Michigan Auto Law is the largest law firm exclusively handling car accident, truck accident and motorcycle accident cases throughout the entire state. We have offices in Farmington Hills, Detroit, Ann Arbor, Grand Rapids and Sterling Heights. Call (800) 777-0028 to speak with one of our Michigan insurance attorneys.

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