No-Fault Accident FAQs
Knowing your rights if you have been injured in a No-Fault accident is the first step to getting the medical treatment, lost wages, medical mileage and other No-Fault benefits you will need as part of your care, recovery and rehabilitation.
This is a complex area of the law that is often confusing and frustrating for car crash victims, even those who have been driving in a No-Fault state like Michigan all of their lives.
Below we address the most frequently asked questions that car crash victims want answers to after they have been injured.
What is a No-Fault accident?
A No-Fault accident is one where an injured person – regardless of fault – gets crash-related medical bills, lost wages and other economic losses paid by his or her own auto insurance company, instead of having to sue the at-fault driver who caused the crash.
There are several factors that must be present for to qualify, such as whether the crash occurs in a No-Fault state and whether the vehicle involved meets the law’s definition of a “motor vehicle.”
However, the two most significant characteristics/qualifications are:
- Any person injured in such a crash gets his or her crash-related medical expenses paid and lost wages reimbursed regardless of whether he or she was at-fault in causing – or even contributing to – the crash. (MCL 500.3105(4))
- Medical expenses and lost wages (as well as other benefits) are paid by the injured person’s auto insurance company, not the auto insurer for the at-fault driver who caused the crash. (MCL 500.3114 and 500.3115)
What is a No-Fault state?
A No-Fault state is a state that has an auto No-Fault insurance law which guarantees that car crash victims will receive medical benefits and lost wages reimbursement from their own auto insurance companies regardless of whether they were at-fault in causing the crash.
There are 12 No-Fault states, plus Puerto Rico.
Other states have tort liability systems where, unlike in No-Fault states, car crash victims must successfully sue the at-fault driver for coverage of their crash-related medical expenses and lost wages as well as other economic losses.
Significantly, in states without No-Fault, also known as pure tort states or tort liability states, if a victim is at-fault in causing the crash, then he or she may be precluded from recovering anything to cover his or her medical expenses and lost wages.
Is Michigan a No-Fault state?
Yes Michigan is a No-Fault state. Michigan switched from a tort liability system to No-Fault in 1973. In 2019, the Michigan Legislature passed a new No-Fault law, which brought about historic and unprecedented changes that will affect every crash victim and driver throughout the state, including for the first time in Michigan, PIP choice that will have various medical benefit coverage levels that drivers will now elect.
What is considered a No-Fault accident?
A No-Fault accident is one that: occurs in a No-Fault state; involves a vehicle that meets the No-Fault law’s definition of “motor vehicle”; and results in medical bills and lost wages being paid by an injured person’s own auto insurance company regardless of whether he or she caused the crash.
Does a No-Fault accident go on your record?
If you were actually at-fault in causing the No-fault accident, then it will likely be reflected on your driving record.
How long does it stay on your record?
This depends on several factors. If you are not at-fault in causing the crash, it will not appear on your driving record. However, if you were you ticketed and convicted of violating the Michigan Vehicle Code (and/or determined to have committed a “civil infraction”), the crash will appear on your driving record. The key is what your conviction or civil infraction is for because the length of time it stays on your driving record will vary based on how serious the underlying conviction or civil infraction was for.
In general, it will stay on your record as follows:
- Points on your driver’s license, which will remain there for two years; and/or
- Convictions on your driving record, which will remain there for a minimum of seven years.
(Sources: Michigan Secretary of State website; MCL 257.320, 257.320a, 257.303 and 257.319)
Do insurance rates go up after a No-Fault accident?
If you were “substantially at-fault” in the No-Fault accident (i.e., “more than 50% of the cause of a crash”), then your auto insurance rates will almost certainly increase. (MCL 500.2111(3)(a); 500.2104(4))
Unfortunately, however, there is nothing in the Insurance Code that prevents your auto insurance company from increasing your rates for a crash where YOU WERE NOT AT-FAULT.
Notably, in 2014, lawmakers introduced House Bill 5517 which proposed to prohibit auto insurance companies from basing rates or premiums “on a crash that an insured or applicant for insurance was involved in if the insured or applicant for insurance was not substantially at fault in the crash.” Unfortunately for the innocent motorists who are injured because of someone else and then punished a second time by their own insurance company with an increase in premiums for a crash that someone else has caused, the bill died due to inaction at the end of the 2013-14 legislative session.
What about a parking lots?
Yes. No-Fault generally applies when a person is injured in a car crash in a parking lot.
- If a person is injured while walking or driving in a parking lot, No-Fault benefits will be available to the injured person.
- If a person is in his or her parked car in a parking lot and is injured when another vehicle crashes into the person’s parked vehicle, No-Fault benefits will be available to the injured person (so long as the injured person in the parked car was insured).
Can I sue after a No-Fault accident?
Yes. There are three potential lawsuits: (1) Suing one’s own auto insurance company for unpaid, overdue No-Fault benefits; (2) Suing the at-fault driver for pain and suffering compensation; and (3) Suing the at-fault driver for a mini tort to cover vehicle damage repair costs.
For additional resources about lawsuits, we recommend the following pages:
- “How to sue for a car accident in Michigan”
- “Car Accident Lawsuit: 18 Mistakes That Can Ruin It”
- “Michigan No-Fault Insurance Lawsuit FAQs”
Get help from Michigan Auto Law today
For help from one of our experienced auto accident attorneys today, call Michigan Auto Law toll free at (800) 777-0028 for a free consultation. There’s absolutely no fee or obligation.