Don’t shortchange your client out of No-Fault benefits after a car accident
Warning – legalese alert. This blog is written more for my Michigan auto accident lawyer and insurance claims adjuster readers. But it addresses an extremely important issue that impacts every economic claim made in every auto accident trial that lawyers in Michigan are making today.
Every auto accident case I’ve ever tried that has had an economic claim also had an excess replacement services claim. For those of you who are unfamiliar with the term, we tell our clients that replacement services are help with services you would have normally performed if you were not injured in an auto accident.
Replacement services claims here have two different, but interrelated meanings. There is the No-fault insurance claim made with your own auto insurance company for replacement services. They are paid at $20 per day, and limited to three years under the Michigan No Fault Act.
Then there is the excess replacement services claim. The excess replacement services claim arises after the first three years of No-Fault, if the auto accident victim is still disabled due to his or her injuries and can’t perform these services. This can also be an excess claim, over and above the $20 per day that the insurance company must pay in replacement services during the first three years.
That’s because the $20 per day for replacement services was set by statute in 1973, but was never indexed to inflation – so it’s the same $20 per day today as it was in 1973. See how many minutes of services $20 get you today. That is why the difference, over and above that $20 per day, can also be brought against the auto insurance company of the person who caused the auto accident in a third-party tort case for injuries, pain and suffering,and economic loss.
The frivolous excess replacement services argument by defense attorneys
Keep in mind, I’ve been making this excess replacement services claim in every one of my auto negligence trials. But recently, some defense lawyers for insurance companies have been making the frivolous argument that “excess replacement services” are not allowable under the Michigan No-Fault Act.
Now, the Michigan Court of Appeals has stopped this silly argument. The Court of Appeals ruled in the published decision of Johnson v Recca, Mich App (2011) (Docket #294363, released 4/5/11), that an auto accident victim may recover compensation in a third-party auto negligence trial, including a claim for excess replacement services. The Court of Appeals also said this claim for replacement services following an auto accident is not limited to the $20 per day for up to three years from the injured accident victim’s own No-Fault insurance company.
In other words, the appellate court confirmed that excess replacement services – either over and above the statutory $20 per day for replacement services, or for replacement services after the first three years of No Fault replacement services – are both recoverable from the at-fault driver in an automobile accident trial as part of the economic claim.
– Steve Gursten is recognized as one of the nation’s top lawyers handling serious auto accident lawsuits. He writes about insurance company abuse and the No-Fault laws in Michigan, and is available for comment.
For lawyers: No-Fault replacement services disability certificate
Time limits for filing auto accident claims in Michigan
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 to better serve you. Call (248) 353-7575 for a free consultation with one of our auto accident lawyers.
2 Replies to “Michigan insurance lawyer tip – excess replacement services are allowable expenses”
I have a full medical policy auto policy, and my I have health insurance. My health insurance will pay for my physical therapy. The Therapy Center says they must bill my health insurance. Who should be billed first? I need my therapy!!
If you have primary medical (Primary PIP) on your auto policy, your auto policy is supposed to be billed and pay for treatment first. However, be aware there may be an additional benefit to you if your health plan is not a self-funded ERISA plan or if your health plan does not include any auto accident exclusions or coordination clauses in it. You can get this information from the health plan administrator. Please contact our office at (248) 353-7575 to discuss this additional benefit further. We are happy to help.