Personal Protection Insurance Benefits Overview

Personal protection insurance is a coverage that you must have if you are driving regularly in Michigan. Required by law, these benefits help victims by paying for medical bills and reimbursing lost wages from a car accident without regard to who caused the accident. Instead of suing the at-fault driver, your own insurer pays.

Whether you have been injured in a car, truck or motorcycle/motor vehicle accident, this coverage can help you get the medical care and treatment and the financial support you need to be able to recover and begin rebuilding your life.

The three key ways that this type of insurance helps car accident victims is by paying their “reasonably necessary” accident-related medical bills up to the coverage level selected in their auto insurance policy, reimbursing them the wages they have lost because their injuries have disabled them from working and paying people to perform the “ordinary and necessary services” that the victims cannot no longer accomplish due to their injuries. (MCL 500.3107(1)(a), (b) and (c))

What is personal protection insurance?

Personal protection insurance is a type of coverage that drivers must carry if they drive regularly in Michigan. Referred to as “personal injury protection” or PIP, these benefits pay for your medical care and lost wages if you have been injured in a car accident – even if you were at-fault.

Is this the same thing as No-Fault PIP insurance?

Yes, this type of coverage is what people are referring to when they talk about No-Fault PIP auto coverage.

Do you need personal protection insurance benefits?

You need personal protection insurance if you are driving regularly in Michigan. First, the law requires drivers to carry this type of car insurance and imposes very severe penalties if they don’t. Second, it provides valuable benefits to cover medical bills and lost wages if you are injured in a car accident.

What medical costs are covered?

The No-Fault law requires that No-Fault PIP insurance covers all expenses for car accident-related medical care that is “reasonably necessary” for a car accident victim’s care, recovery or rehabilitation up to the No-Fault PIP medical benefits coverage level in the policy through which benefits are sought.

Covered medical care includes:

• Medical expenses for doctor visits, hospitalizations, surgeries, procedures, X-rays, MRIs, CT-scans, physical therapy, psychotherapy, cognitive therapy, rehabilitation, prescription medications, home and vehicle modifications to make them more accessible and useable despite a person’s accident-related injuries and physical limitations.
• Attendant care which helps victims with “activities of daily living” – such as bathing, grooming, eating, taking medication and using the toilet – that they can no longer perform independently due to accident-related injuries and limitations.
• Medical mileage which is reimbursement for a car accident victim’s transportation costs associated with traveling to and from doctors’ offices, hospitals, clinics and rehabilitation facilities to receive medical care and treatment.

Are lost wages covered?

Yes. Personal protection insurance benefits will reimburse car accident victims for wages they have lost because their accident-related injuries disable them from working. Lost wages benefits last for three years after the accident and they are subject to monthly maximum amounts.

Because No-Fault wage loss benefits are not taxable, they are reduced 15% so payments will reflect 85% of the victims’ wages.

Are replacement services covered?

Replacement services are covered by No-Fault PIP insurance. These benefits are used to reimburse people who perform the “ordinary and necessary services” that a car accident victim would normally do for him- or herself, but he or she cannot presently because of accident-related injuries or limitations.

Replacement services benefits, which are available during the three years following a car accident, cover every day, household tasks such as housework, cleaning, laundry, shoveling snow, grocery shopping, childcare and taking out the garbage. (MCL 500.3107(1)(c))

Who pays personal protection insurance benefits?

You will turn to your own auto insurance company for payment of benefits. Alternatively, benefits may be paid by the auto insurer for your spouse or a relative who lives with you or an insurer assigned by the Michigan Assigned Claims Plan. Generally, your benefits will not be paid by the at-fault driver’s insurer.

Coverage levels

The only choice that drivers must make about coverage levels for personal protection insurance benefits concerns the level of No-Fault PIP medical benefits coverage they want. For the last 40 years, all drivers were required to carry “unlimited” medical coverage. Starting July 1, 2020, drivers have five coverage options to choose from.

Specifically, in auto insurance policies issued or renewed after July 1, 2020, drivers must choose one of the following coverage levels for their No-Fault PIP medical benefits, which pay for car accident victim’s accident-related medical care:

• $50,000 limit on medical expenses for drivers who are enrolled in Medicaid (MCL 500.3107c(1)(a))
• $250,000 limit (MCL 500.3107c(1)(b)
• $500,000 limit (MCL 500.3107c(1)(c))
• Unlimited or no dollar-amount limit (MCL 500.3107c(1)(d))
• Opt out of No-Fault PIP medical benefits altogether for drivers on Medicare (MCL 500.3107d(1))

It’s important to note that the amount of No-Fault medical benefits you will have available to you depends on – and is limited by – the coverage level you selected in your policy or that your spouse or a family selected in their policy if you are claiming benefits through them and their No-Fault auto insurance policy. (MCL 500.3107(c)(5))

Excess coverage

If your accident-related medical bills exceed the No-Fault PIP medical benefits coverage level in the policy through which you are claiming personal protection insurance benefits, then you may sue the at-fault driver for the “excess” medical benefits amount. Similarly, if your lost wages exceed the 3-year or monthly limitations, then you may also sue the at-fault driver for the “excess” wage loss amount. (MCL 500.3135(3)(c))

Injured and need a lawyer? Call Michigan Auto Law

If you have been injured in a car accident and you have questions about your legal rights and the benefits under your personal protection insurance, you can call toll free anytime 24/7 at (800) 968-1001 for a free consultation with one of our experienced auto accident attorneys. You can also get help from an experienced accident attorney by visiting our contact page or you can use the chat feature on our website.