PPI Insurance (Property Protection Insurance): What You Need To Know
PPI insurance, which is also called property protection insurance, is one of the mandatory coverages that all drivers must carry as required by Michigan’s No-Fault auto insurance law. It covers the cost of damage to tangible property resulting from a car accident.
What is property protection insurance?
Property protection insurance, which is also called PPI insurance, is a required coverage under Michigan’s No-Fault law. It covers accidental damage to another person’s tangible property resulting from a car accident. A claim is filed with the insurer for the owner or driver of the car.
What does this insurance cover?
The damage to tangible property that is covered by PPI insurance consists of “physical injury to or destruction of the property and loss of use of the property so injured or destroyed.” (MCL 500.3121(3) and (5))
For damaged or destroyed property, coverage will pay for the “lesser of reasonable repair costs or replacement costs less depreciation.” (MCL 500.3121(3) and (5))
Coverage for the “loss of use” of a damaged vehicle (that was parked and unoccupied at the time that it was struck and damaged by another driver) has been interpreted to include the “value” or cost of a rental car.
What types of property are covered by this insurance?
Property protection insurance will cover car accident-related damage to property such as safely parked cars, fences or trees.
Importantly, this insurance will not cover car accident-related damage to a vehicles, their contents or trailers if they are “parked in a manner” that causes “unreasonable risk of the damage which occurred. (MCL 500.3123(1)(a))
Similarly, this insurance will not cover “property damage to utility transmission lines, wires, or cables arising from the failure of a municipality, utility company, or cable television company.” (MCL 500.3123(3))
Will property protection insurance cover out-of-state car accidents?
No. Property protection insurance will not pay to cover “property damage arising from motor vehicle accidents occurring outside the state.” (MCL 500.3123(2))
Does PPI insurance depend on fault?
No. This insurance provides coverage for damage to tangible property resulting from a car accident regardless of who was at-fault in causing the property damage. (MCL 500.3121(2))
What is a PPI insurance claim?
A property protection claim is a claim for coverage of damage to tangible property resulting from a car accident. The claim will be filed with the auto insurance company for the owner or driver of the vehicle involved in the accident.
How do I make a PPI Insurance claim?
The owner of the damaged property will file a claim with the auto insurance company for the owner of the car that was involved in the car accident that caused the property damage. However, if recovery cannot be made, the claim will be filed with the insurer of the driver of the involved vehicle. (MCL 500.3125)
How much will this type of insurance pay?
The driver’s property protection insurance will pay “the lesser of reasonable repair costs or replacement costs less depreciation and, if applicable, the value of loss of use.” But the payout on this type of insurance claim will not exceed $1 million. (MCL 500.3121(5))
Importantly, if the driver of the vehicle involved was at-fault in causing the property damage, then the property owner may be able to sue the driver for “tort liability” for damages in “excess” of the $1 million limit up to $4 million when “liability insurance required by federal statute or regulation is in effect.” (MCL 500.3136(1) and (2)
Are there time limits for filing a PPI insurance claim?
A property owner cannot sue on this type of claim “later than 1 year after the accident.” (MCL 500.3145(5))
Importantly, if you are forced to file a lawsuit for for these insurance benefits, you must name the auto insurance company for the involved vehicle’s owner and/or driver as the defendant because the actual responsible party with this type of claim is the owner’s or driver’s auto insurer.
If you fail to name the owner’s or driver’s auto insurance company as the defendant in your suit for unpaid property protection benefits and instead you only name the driver and/or owner of the car as the defendants, and the one year statute of limitations expires, you will not be able to name the insurer to the lawsuit at a later date.
Is gap insurance personal protection insurance?
Property protection insurance is not gap insurance.
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