There are big changes coming to what is required for motorcycle insurance in Michigan under the new No-Fault law. These changes take place July 1, 2020, and involve the following four important areas:
- No-Fault benefits for a motorcyclist (whether an operator or rider) injured in a crash with a car or truck will be limited to the No-Fault medical benefits coverage levels chosen by the motorists involved in the crash. It no longer matters what motorcycle insurance coverage the motorcyclist may personally already have available. This will apply when the new No-Fault PIP medical benefits coverage levels become available for all auto insurance policies that will be issued or renewed on or after July 1, 2020.
- If there is no source of No-Fault benefits coverage available for a motorcyclist who is injured in a crash with a car or truck, then the claim for PIP benefits will now go through the Michigan Assigned Claims Plan and will be subject to a $250,000 limit that is set by the new auto No-Fault law. This took effect on June 11, 2019.
- Motorcyclists who have been injured in a crash with a car or truck and whose No-Fault benefits have been limited by provisions enacted in the new No-Fault law above will now be able to sue the at-fault driver of the car or truck to recover excess medical benefits. This will begin to happen after the new No-Fault PIP medical benefits coverage levels become available, which in the majority of cases will also be after July 1, 2020.
- Starting July 2, 2020, the mandatory minimum limits on motorcyclists’ liability coverage will increase from $20,000/$40,000 to $50,000/$100,000. (MCL 500.3103(1); 500.3009(1) and (5))
UPDATE: On July 18, 2019, Rep. Kyra Bolden (D-Southfield) introduced House Bill 4812, which would ensure that motorcyclists injured in a crash with a car or truck can claim No-Fault PIP medical benefits through their own auto insurer and not be limited by the coverage levels chosen by the owners, registrants and/or operators of the motor vehicles involved in the crash. Similarly, on September 17, 2019, Sen. Peter Lucido (R-Shelby Township) introduced Senate Bill 528 which would also ensure that motorcyclists can claim No-Fault PIP medical benefits through their own auto insurer. However, SB 528 would eliminate insurers of the owners and operators of any of the motor vehicles involved in an accident as potential sources of No-Fault benefits.
In a recent interview with The Detroit News for its story, “Motorcyclists worry insurance reform law leaves them vulnerable,” Michigan Auto Law attorney Brandon Hewitt assessed the challenges that motorcyclists will now face:
“‘There’s going to be a lot of these significantly injured motorcyclists who run out of coverage and are stuck with the bills themselves, be forced into bankruptcy or have to turn to Medicaid.'”
That’s because suing for “excess” and future necessary medical care will be limited by the insurance policy limits and the assets of the at-fault drivers who cause these motorcycle accidents. Attorney Brandon Hewitt emphasized that the new No-Fault law was “a ‘big deal’ for motorcyclists because motorcycle accidents often involve some of the ‘worst injuries,’ – including catastrophic brain and spinal cord injuries that can often require lifetime medical care.”
Hewitt’s advice for motorcyclists was to purchase motorcycle insurance policies with as much medical coverage as they can because of the uncertainty about what other drivers may be carrying.
Limits on Motorcycle Insurance in Michigan
The new No-Fault law has not changed the sources of No-Fault benefits for motorcyclists (whether they are operators or riders) who are injured in a motorcycle accident with a motor vehicle:
- Motorcyclists will continue to first seek No-Fault benefits from the “insurer” of the owner of the motor vehicle involved in the accident and, then, the “insurer” of the vehicle’s operator. (MCL 500.3114(5)(a) and (b))
- After that, injured motorcyclists will continue to turn to the “motor vehicle insurer of the operator of the motorcycle involved in the accident” and, then, the “motor vehicle insurer” of the motorcycle’s owner or registrant. (MCL 500.3114(5)(c) and (d))
- If no motorcycle insurance coverage is available through any of these sources, then an injured motorcyclist will have to file a claim for No-Fault benefits with the Michigan Assigned Claims Plan. (MCL 500.3114(6))
But the new No-Fault law has changed the amount of No-Fault benefits available to a motorcyclist who has been injured in a crash with a car or truck:
- An injured motorcyclist’s No-Fault medical benefits are limited by whatever No-Fault coverage level exists in the auto insurance policy from which they are seeking benefits – which could be $50,000 (for drivers on Medicaid), $250,000, $500,000 or unlimited. (MCL 500.3107c(5)) This means that even if the motorcyclist has his or her own unlimited No-Fault auto insurance policy on his or her own motor vehicle, the level of No-Fault PIP medical benefits to which he or she will be entitled is limited by the coverage levels chosen by the owner or driver of the motor vehicle or motorcycle involved in the crash.
- For injured motorcyclists seeking No-Fault benefits through the Michigan Assigned Claims Plan, their No-Fault PIP medical benefits will be limited to $250,000. (MCL 500.3114(6); 500.3172(7)(a); 500.3107c(1)(b))
As attorney Brandon Hewitt told The Detroit News, one way that motorcyclists can protect themselves and ensure they have adequate medical coverage in the event of a crash is to obtain a high-limit motorcycle insurance policy that provides for “payment of first-party medical benefits” under MCL 500.3103(2).
Does the New Motorcycle Insurance in Michigan now allow for Suing for Excess and Future Medical Cost
Although the new No-Fault law imposes restrictive “caps” on the amount of No-Fault benefits that an injured motorcyclist can collect after a motorcycle accident with a car or truck, it does give them at least some hope for also getting back some of the medical care and treatment they need.
A motorcyclist will be able to sue the at-fault driver for “excess” medical benefits, which is the amount by which an injured motorcyclist’s medical needs and medical expenses exceed the new No-Fault PIP medical benefits coverage levels of the policies associated with the accident. (MCL 500.3135(3)(c))
Motorcycle Insurance in Michigan Under The Current No-Fault Law
Click here to get information on Michigan motorcycle insurance requirements under the current law.
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