Replacement Service Benefits

According to Section 3107(b) of the Michigan No Fault Act statute, you are entitled to a maximum of $20 per day in replacement services during the first three years following a Michigan car accident injury. The types of services which qualify include:

• Investment income replacement service benefits,
• housekeeping,
• lawn and garden maintenance,
• auto maintenance,
• meal preparation,
• baby-sitting/child care, and
• driving family members to school and appointments.

The Michigan Court of Appeals has ruled that investment services such as financial planning and investing are not recoverable as a replacement service benefit.

Replacement service benefits are paid in addition to the wage loss maximum. However, if a death claim is made then the replacement service benefits and survivor's loss benefits combined is subject to the monthly maximum.

In order to qualify for replacement service benefits, the services must have been reasonably incurred. Initially, the insured had to prove that he or she actually paid for the services or incurred a financial obligation to pay for them. But the Michigan Court of Appeals adopted a less strict requirement, reflected in its holding that a plaintiff's testimony that she had an oral contract with her kids to do household services was sufficient.

Replacement services can be performed by family members.

The $20.00 per day for replacement service benefits only applies to those things which the injured person usually did for himself or his dependents.

A wife can collect $20.00 per day for her services to her injured spouse during convalescence, similar to worker's compensation.

The replacement services must be "reasonably incurred," meaning actual payment or assumption of liability to pay, not just the fair market value of the services rendered.

A guardian is not entitled to replacement service benefits for managing personal investments of his ward. Nor are replacement services available for income or profit motivated activities. For example, an adult foster care proprietor is not allowed to hire replacement employees for $20.00 per day.