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Drivers need to understand their auto insurance policies — because their agents may not

December 7, 2010 by Steven M. Gursten

Auto accident attorney reveals Citizens Insurance agents’ misstatements about No-Fault medical insurance coverage

Too often, our auto accident attorneys hear from injured drivers who have been given completely wrong information from the insurance agents who sold them their Michigan No-Fault auto insurance policies.

One particularly troublesome, and recurring, situation I see involves Citizens Insurance Company. This is happening when agents for Citizens Insurance Company erroneously inform the company’s paying customers that Citizens is paying a greater share of the insured’s medical coverage than it actually is. Oops. Big problem.

The misinformation is happening after an insured person has been injured in an auto accident, and calls her Citizens Insurance agent to learn whether she should submit her medical bills for care stemming from her car accident-related injuries to Citizens (her No-Fault insurance company ) or to her health insurance company.

The question involves a formalistic, thorny insurance law issue called “priority”: Whether the injured Michigan driver’s No Fault insurance company will be the “primary” or “secondary” source of her No-Fault medical coverage. To learn more, read about insurance coverage issues in Michigan.

For people who do not spend all day and every day poring over car insurance policy language — as Michigan auto accident attorneys and insurance agents and adjusters do — the medical insurance coverage question is a reasonable one. And every competent agent should be prepared to answer it correctly.

But that’s not always how things have been working out with Citizens.

What Citizens No-Fault insurance policy says

In the cases seen by the auto accident attorneys at Michigan Auto Law, the injured Michigan driver has a Citizens policy that says the following about the driver’s No-Fault insurance coverage (also called personal injury protection or PIP coverage):

“Liability Coverages

Personal Injury Protection: Medical Excess …

Personal Injury Protection Full Coverage

Work Loss: Income Benefits/Replacement Services”

Under the policy language above, Citizens Insurance has “secondary priority” for paying its insured’s accident-related medical costs.

That means that Citizens assumes responsibility for the injured driver’s medical costs after the driver’s health insurance company (which has primary priority) has reached its coverage limit.

The reason this is so is because the policy describes its personal injury protection coverage for medical expenses as “excess.” The significance of that obvious designation cannot be overstated.

But somehow, Citizens’ agents still manage to repeatedly get it wrong. Instead of accurately reporting that Citizens is “secondary” as to medical coverage, Citizens’ agents erroneously report that Citizens is “primary.”

Citizens Insurance agents are misreading No-Fault insurance policies

Because Citizens has yet to explain its otherwise inexplicable repeated mistakes on this point, there appears to be only one explanation.

Citizens’ agents don’t understand their own policies.

They’re zeroing in on the language that says “Personal Injury Protection Full Coverage,” and overlooking (or ignoring) everything else.

Citizens’ agents are not taking into account the plain and unambiguous language limiting “Full Coverage” to wage loss and replacement services benefits, only. Nor are the insurance agents accounting for the prominently placed language downgrading Citizens’ responsibility for medical expenses to the financially-safer, less costly status of “secondary priority.”

The reason this is important is because a driver should get what they pay for. If Michigan drivers want to get the coverage they think they are paying for, then they need to make themselves the “primary priority.”

They need to understand everything there is to know about the auto insurance coverage provided in their No- Fault auto policies because, as the situation with Citizens Insurance Company shows, their trusted insurance agent may not.

This blog was written by Steve Gursten and Todd Berg

Steve Gursten is recognized as one of the nation’s top auto accident attorneys handling serious car and truck accident cases and insurance No-Fault litigation. Steve speaks and writes extensively on Michigan’s No-Fault law and insurance company abuse, and is available for comment.

– Todd Berg is an Illinois attorney. At Michigan Auto Law, he provides analytical, research and writing support to the firm’s auto accident attorneys. Todd was formerly a trial and appellate attorney in Illinois. He was also a legal news reporter and editor with Michigan Lawyers Weekly.

Related information:

Michigan No-Fault insurance law

Your Michigan No-Fault insurance benefits

The real reason your auto insurance rates in Michigan keep going up

Michigan Auto Law is the leading and largest law firm exclusively handling car accident, truck accident and motorcycle accident cases throughout the entire state for more than 50 years. We have offices in Farmington Hills, Ann Arbor, Detroit, Grand Rapids and Sterling Heights to better serve you. Call (248) 353-7575 for a free case evaluation with one of our auto accident attorneys.

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