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Car Insurance For Teenagers: Michigan Laws For Minors Explained

June 15, 2022 by Steven M. Gursten

Car Insurance For Teenagers: Michigan Laws For Minors Explained

Car insurance for teenagers in Michigan is required whether they are driving with a learner’s permit or a driver’s license. In Michigan, if teenagers drive their own vehicle, they will be the “named insured.” If they drive their parents’ car, they will likely be a “named driver” on their parents’ car insurance policy.

There is no “special” car insurance for teenage drivers who have a learner’s permit or who just got their driver’s license.  However, there are many important considerations that come into play when making decisions about car insurance for teenagers in Michigan.

I always tell parents to first check with their insurance agent as to what specific rules your particular insurance company may have when it comes to their teenagers reaching the legal driving age and beginning with their graduated drivers license, whether that is getting their learner’s permit or their driver’s license.  

Importantly, whatever you are told by your insurance agent should be confirmed in writing.  Never rely solely on the oral representation of your insurance agent.  Ideally, have your agent send an email confirming coverage and any specific coverage requirements for your teenage driver. 

 Most car insurance companies do not require a teen driving on a learner’s permit to have car insurance coverage in his or her name (in fact, I have yet to see one), but that still doesn’t mean one or more of the 81 car insurance companies who do at least $1 million in business annually in this state does not have its own specific and unique contractual provisions on how you should be adding your teenager to your car insurance. There are also  another 150-200 car insurance companies every year who are certified to do business in Michigan, and while I like to say that nearly 30 years of being a car accident lawyer and helping people who’ve been hurt in car wrecks that I’ve probably sued almost every insurance company in Michigan at one time or another, I certainly have not read 281 insurance policies out there as to each insurer’s specific requirements for car insurance for teenagers. 

My takeaway for you is that each insurance policy is a contract, and each policy can have different and sometimes unique contractual requirements on how to add your teenagers to your car insurance in Michigan, so my most important advice is to always  confirm – in writing – with your own insurance company that your teenager will be covered under your existing car insurance policy. 

To learn more, check out Michigan Auto Law attorney Brandon Hewitt’s interview with WZZM TV 13:

Is car insurance for teenagers required?

Michigan law requires car insurance for teenagers – and for all drivers – who are driving their own motor vehicles on Michigan roadways. (MCL 500.3101(1))

Is there a special kind of car insurance for teenagers?

There is no special kind of car insurance for teenagers in Michigan. This is true whether they are driving on a learner’s permit or they are fully-licensed. As with adult drivers, if a teenager is driving his or her own car or truck, then valid Michigan No-Fault auto insurance must be maintained at all times.

Car insurance for teenagers who are driving their own cars

Michigan teenagers who are driving their own cars (i.e., vehicles for which they are the titled owner or will be considered a “constructive owner” of the vehicle based on how frequently they are driving that vehicle) are legally required to maintain valid No-Fault auto insurance coverage at all times. This includes No-Fault PIP, liability, property damage and property protection insurance. (MCL 500.3101(1)) Because it is their vehicle, they will be the “named insured” on the policy.

Recommended car insurance coverage for teenagers

I realize car insurance for teenagers will be expensive.  That said, my recommended car insurance coverage for Michigan teenagers who drive their own cars or trucks includes: (1) unlimited No-Fault PIP medical coverage with no deductible; (2) liability coverage of at least $500,000; and (3) uninsured motorist coverage and underinsured motorist coverage.

Again, I know these recommendations will make the expensive addition of adding your teenager more expensive than a bare minimum policy with lower PIP medical caps.  

Consider for a moment the reason why car insurance for teenagers is so much more expensive.   Statistically, teenagers are very dangerous drivers.  Teenage drivers cause the highest number of automobile accidents.   They have little experience and sometimes can display very poor driving judgment.  

If the odds of your young teenage driver being involved in a car accident is higher, then it makes sense to have more protections in place, not less.  That’s why I feel full, unlimited medical PIP can be so critical.  Most health insurance coverages out there have exceptions for car accidents, or they have limitations on the types of treatment and medical care that someone may desperately need after being injured in a bad car crash.  The UM and UIM coverage is also very important because it will help you recover pain and suffering compensation if you are injured by an at-fault driver who is either “uninsured” or has inadequate liability insurance coverage.

Car insurance for teenagers who are driving their parents’ cars

Unless a teenager qualifies as a “constructive owner” of their parents’ cars, a teenaged driver will not be legally obligated to maintain No-Fault auto insurance on their parents’ vehicles. A “constructive owner” is someone who has “the use of a motor vehicle . . . for a period that is greater than 30 days.” (MCL 500.3101(3)(l)(i) 

What should I do about car insurance for my teenage driver?

Tell your auto insurance company once your teenager becomes old enough to drive, obtains a learner’s permit and/or obtains a driver’s license. Depending on the circumstances and your insurer, you may also need to add your teenager as a “named driver” on your policy for the vehicles he or she will be driving. 

Many auto insurance companies today require their insureds to report changes in: (1) the driver’s license status or learner’s permit status of the people who live in the insured’s household; (2) the number of persons of legal driving age in the home; and (3) the number of persons in the home who regularly use one or more of the vehicles covered under the policy.

To find out what your obligations are under your auto insurance policy, start by reviewing the sections with titles like “Changes,” “Duty to Report Changes,” and “Premiums.” 

Do I have to add my teenager to my car insurance in Michigan?

Many insurance companies do not require you to add your teenager as a “named driver” to your car insurance in Michigan, but please make sure to confirm this in writing with your own insurance agent.  Many insurers may not require you add teenagers to your car insurance policy, but they may require notice that you have a  teenager who is old enough to drive or who has started driving under Michigan’s graduated licensing program and that he or she lives with you and will be driving one of your cars. You should review your insurance policy and talk to your insurance agent to find out exactly what specifically your own company may require you to do. 

Do I need to add my child to my car insurance with a permit?

If you have a teenaged child who is driving on a learner’s permit, then you may have to add him or her as a “named driver” on your car insurance policy. It will depend on your particular auto insurance company and the specific terms and contractual requirements of your car insurance policy.  These contractual requirements can vary dramatically between insurance companies.  

When do I have to add my teenager to my car insurance?

In Michigan, whether and when you have to add your teenagers to your car insurance policy will depend on your auto insurance company and terms of your policy. Start by checking your policy provisions that deal with “Changes,” “Duty to Report Changes,” and/or “Premiums.” This will help you identify what you must do and when.

What if I don’t tell the car insurance company about my teenage driver?

When it comes to car insurance for teenagers and Michigan law, you are taking a very big risk.  In Michigan, if you don’t tell the car insurance company about your teenage driver they may void your entire policy if you were supposed to inform your insurer that your teenager is driving a car that you insure, or that he or she has a learner’s permit or driver’s license, but you failed to do so. Your insurer may claim you made incorrect statements, concealed or misrepresented facts or even committed fraud.

But then it gets much worse.

The insurance company can attempt to void your policy. That means that if your teenager is involved in an auto accident – and is either injured or was at-fault for causing a car crash that injured others – your auto insurer can void your policy and deny all coverage related to the auto accident.

If that happens, then your injured teenager will be disqualified from receiving No-Fault benefits to cover medical bills and attendant care if he or she is very seriously injured. Your injured teenager will also be barred from suing an at-fault, negligent driver if another driver caused the car accident and injured him or her.  That means even if your teenager is completely innocent, he or she would still be barred from bringing a car accident lawsuit for pain and suffering compensation. Finally, in the event that your teenager was at-fault for causing a crash that injured or killed others, your liability coverage through your auto insurer would contribute nothing to help you pay a judgment for pain and suffering compensation or wrongful death damages. You as a titled owner of the motor vehicle can still be sued under Michigan’s owner’s liability statute and you could also be found to be personally liable if the injuries are worth more than your insurance coverage.  

Voiding your auto insurance policy allows the auto insurance company to attempt to rid itself of all legal liability for any claims or damages your car insurance company may have otherwise been obligated to pay under your policy.  Remember, your car insurance policy is essentially a contract, and the terms will be found binding unless it violates Michigan statutory law.  

All of this means that this can leave you and your family without insurance coverage and therefore utterly unprotected. 

To learn more, check out your policy provisions that address “Concealment,” “Misrepresentation” or “Fraud.” 

What happens if I don’t add my teenager to my car insurance?

In Michigan, if your car insurance company requires you to add your teenager or teenagers as a “named driver” to your car insurance policy, but you fail to do so, then you risk having your entire policy voided. If that happens, your insurer will have no legal obligation to provide any benefits or liability coverage if a crash should occur.

The biggest mistake I see as an auto accident lawyer regarding teen drivers is the parents’ failure to list their teenagers as “named drivers” on their car insurance policies. This is very dangerous for all the reasons I explained above. 

If your teen causes (or is injured in) a serious car accident when driving a car that he or she normally drives but is not listed on the policy as a “named driver,” there can be disastrous consequences. Your auto insurance company may accuse you of insurance fraud, void your policy and cancel all coverage and benefits you would have otherwise been legally entitled to. 

The consequences would include your insurer refusing to pay your child’s medical bills and your child being barred from suing an at-fault driver (the driver who actually causes the car crash that injures your child) even when your teen is completely innocent and seriously injured.

Will my insurance company increase my rates if I tell them about my teenage driver?

In Michigan, it is very likely that your auto insurance company will increase your car insurance premium rates at some point once you tell your agent about your teenage driver and that he or she has started driving.  However, the alternative as I’ve explained above is risking having your policy voided – and that  is a far more costly and disastrous consequence.

Most auto insurance policies that require insureds to report about their teenagers’ learner’s permit and driver’s license status, etc., make it clear that the information will likely result in a “premium adjustment.”  

My best advice is to shop around and to use an independent insurance agent who can quote from many different companies.  Comparison shopping works, especially when buying car insurance for teenagers.

Does a permit driver need insurance?

Every Michigan driver, teenagers and adults – whether driving on a learner’s permit or a valid, Secretary of State-issued driver’s license – needs to have at least existing and valid No-Fault auto insurance coverage on his or her own car or truck. However, a parent’s or titled owner’s insurance is usually enough.  There is not a separate or special kind of car insurance required for teenage drivers with learner’s permits.

Can you get car insurance with a permit?

In Michigan, it is unlikely that you can get car insurance with only a learner’s permit – this goes for teenagers or even adults who are learning to drive later in life. Generally, auto insurance companies will not issue policies to people who are not yet licensed drivers. 

Under Michigan law, a person is “eligible” for No-Fault auto insurance if he or she has a valid Michigan driver’s license or owns a vehicle registered (or that must be registered) in Michigan. (MCL 500.2103(1)) However, a driver’s license (and proof of insurance) is required to register a vehicle in Michigan.

Do you need insurance to drive with a permit?

In Michigan, you need car insurance to drive with a permit – this goes for teenagers and adults and whether it is your own the vehicle or it belongs to someone else. Not only does the Michigan No-Fault auto insurance law require that all vehicles be covered, it also makes it a misdemeanor to drive your own or someone else’s uninsured vehicle. (MCL 500.3102(2))

Can someone with a permit drive my car?

Yes, in Michigan someone with a permit can drive your car, although it will depend on the specific conditions and restrictions of the motor vehicle owner’s car insurance policy.   

Under Michigan’s “owner liability” law, you as the titled owner of a motor vehicle are legally liable for any personal injury or property damage “caused by the negligent operation” of your vehicle by a teenage driver on a learner’s permit. (MCL 257.401(1))

Can a 16-year-old get their own car insurance?

In Michigan, 16-year-old teenagers cannot get their own car insurance policy. Because the teenager is under the age of 18, he or she is still considered a “minor” and, thus, could not purchase an insurance policy without his or her parents’ consent and agreement to co-sign for the policy. (MCL 722.1(a)) 

Similarly, an unemancipated 16-year-old – by virtue of his or her minority status – cannot purchase a motor vehicle “without the written consent of 1 of the minor’s parents or his guardian on a form approved by the secretary of state.” (MCL 750.421c)

Has your teenager been injured in a car accident?  Call the auto accident attorneys at Michigan Auto Law

If you or a young driver were injured in a car crash and you have questions about your legal rights to pain and suffering compensation, economic damages and auto No-Fault insurance benefits, you can speak to an experienced car accident lawyer at (800) 777-0028 for a free consultation. You can also get help from an experienced No-Fault insurance attorney by visiting our contact page or you can use the chat feature on our website.

Car Insurance For Teenagers: Michigan Laws For Minors Explained

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