Why is my Auto Insurance Company Making Me Apply for Social Security Disability?

People injured in motor vehicle accidents and collecting no fault insurance benefits (PIP benefits) are frequently told by their insurance companies that they must apply for Social Security Disability (SSD). Michigan SSD lawyers and lawyers who help people injured in car accidents have become all too familiar with this common practice. Michigan’s auto insurance companies are now forcing their own customers to apply for Social Security Disability, and then re-apply and appeal if they are not awarded disability.

Unfortunately, this practice has led to abuse, as insurance company adjusters are now threatening people who fully intend to return to work, as well as people who obviously do not qualify, to apply for SSD as a requirement to continued no fault insurance benefits. The reason that Michigan insurance companies are requiring their own insureds to apply for Social Security Disability is simple: it saves them money.

If someone injured in an automobile accident refuses to apply for Social Security Disability, an insurance company can stop paying no fault PIP benefits. The irony is that people in Michigan are forced to purchase very expensive automobile insurance from auto insurance companies which are supposed to protect them when they are needed most. In return for premiums, these insurance companies promise to pay wage loss and other PIP benefits to people if they are hurt in an automobile accident. But once someone is actually injured in a car accident, auto insurance companies soon require the injured person to apply for Social Security Disability. The insurance company’s plan is to transfer part of their contracted-for wage loss obligation to the public and government by shifting the burden on social security.

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