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Michigan No-Fault car insurance death benefits increase

September 16, 2017 by Steven M. Gursten

Starting October 1, 2017, we will see an increase of nearly $100 in monthly maximum for No-Fault car insurance death benefits, also known as survivor’s loss benefits

Car insurance death benefits

What is the maximum amount the family of a Michigan auto accident victim can receive in monthly No-Fault car insurance death benefits — also known as survivor’s loss benefits — for 2017-18?

“[T]he new … survivors’ loss benefit payable, effective October 1, 2017 through September 30, 2018, shall not exceed $5,541 per single 30-day period.”

That’s according to the Michigan Department of Insurance and Financial Services (DIFS)’s Bulletin 2017-12-INS, entitled “Annual Adjustment of the Maximum Work Loss Benefit and Survivors’ Loss Benefits Payable under Policies of Personal Protection Insurance.”

Significantly, the monthly No-Fault car insurance death benefits max will increase by $89 from the 2016-17 maximum amount of “$5,452 per single 30-day period.”

How do No-Fault car insurance death benefits work?

Among the many No-Fault benefits and protections guaranteed to car crash victims, one of the most important — and least discussed — are car insurance death benefits.

Here’s how car insurance death benefits/survivor’s loss benefits work if you have lost a loved one in a Michigan car accident.

What is compensable under No-Fault survivor’s loss?

No-Fault “personal protection insurance benefits” (also known as No-Fault PIP benefits) are “payable for a survivor’s loss which consists of a loss, after the date on which the deceased died, of contributions of tangible things of economic value, not including services, that dependents of the deceased at the time of the deceased’s death would have received for support during their dependency from the deceased if the deceased had not suffered the accidental bodily injury causing death and expenses, not exceeding $20.00 per day, reasonably incurred by these dependents during their dependency and after the date on which the deceased died in obtaining ordinary and necessary services in lieu of those that the deceased would have performed for their benefit if the deceased had not suffered the injury causing death.” (MCL 500.3108(1))

Who pays the car insurance death benefits when someone is killed in a car accident?

No-Fault car insurance death benefits are paid by the deceased car accident victim’s auto insurance company and they’re paid “without regard to fault,” i.e., regardless of whether the deceased person was at fault in causing the accident that resulted in his or her death. (MCL 500.3105(1) and (2))

How long are car insurance death benefits collectible?

Car insurance death benefits are “not payable beyond the first three years after the date of the accident” that resulted in the car accident victim’s death and they’re capped at a monthly “maximum” amount (which is stated above) that’s “adjusted annually” to “reflect changes in the cost of living,” but a “change in the maximum shall apply only to benefits arising out of accidents occurring subsequent to the date of change in the maximum. The maximum shall apply to the aggregate benefits for all survivors payable under this section on account of the death of any one person.” (MCL 500.3107(1)(b))

What is covered by No-Fault car insurance death benefits?

The No-Fault Law provides that the “dependents” of a car accident victim who has passed away are entitled to “survivor’s loss” benefits, which include compensation for “tangible things of economic value” that the car victim would have provided to the dependents had he or she lost his or her life in a Michigan car crash. (See MCL 500.3108(1).)

Michigan courts have said the following about what constitutes “tangible things of economic value”:

  • The “plain language” of Michigan’s No Fault Law demonstrates that survivor’s loss benefits “encompass[] old-age social security benefits …”
  • Compensable survivor’s loss benefits are not limited to only those benefits that are employment-related and/or provided by an employer.

The No-Fault survivor’s loss max isn’t the only thing that’s changing for the coming year. There’s also a new maximum that a Michigan auto accident victim can receive in monthly No-Fault car insurance lost wages benefits for 2017-18.

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