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Michigan Auto Insurance Reform Explained

Michigan Auto Insurance Reform

Michigan auto insurance reform has brought about sweeping, fundamental and unprecedented changes to Michigan’s No-Fault law that affect every driver and car accident victim in this state. The changes include PIP choice, opt-outs, attendant care limits, a fee schedule and increased bodily injury liability coverage.

It is essential that all drivers and car accident victims understand how Michigan auto insurance reform may have changed their legal rights under their personal protection insurance benefits policies and how their ability to recover No-Fault PIP benefits after a car crash could be affected.

Our experienced car accident lawyers want to provide you with all of the information you need to understand the vital, legal rights that are at stake under the Michigan No-Fault reform that was enacted in Public Acts 21 and 22 of 2019, which took effect on June 11, 2019.

We want you to understand what the changes from Michigan No-Fault insurance reform mean for you and your family.

Michigan Auto Insurance Reform: Important Changes to No-Fault

Michigan auto insurance reform has changed Michigan’s No-Fault law in significant and substantial ways that will affect every driver and every car accident victim in Michigan. Those changes include:

  • PIP Choice – After nearly 40 years of requiring all drivers to carry “unlimited” No-Fault medical coverage to protect them and their families in case they are injured in a car accident, the law now requires drivers to choose from one of four No-Fault PIP medical benefits coverage levels: (1) $50,000 for drivers enrolled in Medicaid; (2) $250,000; (3) $500,000; and (4) unlimited or no limit. These new No-Fault medical coverage choices become available in policies issued or renewed after July 1, 2020.
  • Opt-out of No-Fault medical coverage – Drivers who have Medicare can choose to opt-out of No-Fault PIP medical benefits altogether. However, if they are injured in a car accident, No-Fault will not pay for any accident-related medical bills. The legislative intent behind this change is that these drivers would turn to Medicare for medical coverage for injuries suffered in a car accident. The Medicare/opt-out will become available in policies issued or renewed after July 1, 2020.
  • Attendant care – Auto insurance companies will not be obligated to pay for more than 56 hours per week for in-home, family-provided attendant care provided after July 1, 2021. This limitation in the No-Fault law does not apply to attendant care provided by a nurse from a commercial agency or in a residential facility.
  • Michigan Catastrophic Claims Association – The Michigan Catastrophic Claims Association (MCCA) will continue to pay for the medical costs of catastrophically injured car accident victims who are claiming medical benefits through a No-Fault auto insurance policy that was issued or renewed before July 2, 2020. However, for policies issued or renewed after July 1, 2020, the MCCA will only pay for a car accident victim’s catastrophic medical coverage only if “unlimited” was the No-Fault PIP medical benefits coverage level selected in policy.
  • Medicare-based fee schedule – Starting July 1, 2021, doctors, hospitals, clinics, medical providers and other persons who treat and care for car accident victims will have to conform their charges for services to a new Medicare-based fee schedule.
  • “Excess” medical expenses – Car accident victims whose accident-related medical bills exceed the relevant No-Fault PIP medical benefits coverage level in the auto insurance policy through which they have made their No-Fault claim will be able to sue the at-fault driver in a third-party tort lawsuit for payment of present and future “excess” medical bills. This will become an issue after the No-Fault PIP medical benefits coverage levels become available after July 1, 2020.
  • Michigan Assigned Claims Plan – Car accident victims who must claim Michigan No-Fault insurance benefits through the Michigan Assigned Claim Plan (which is designed to assign car insurance companies to provide benefits to victims who otherwise has no source of insurance coverage) will be subject to a cap of $250,000 on medical benefits.
  • Bodily injury liability coverage – Starting on July 2, 2020, drivers will be required to carry bodily injury liability insurance in the amounts of $250,000 and $500,000 that provides liability coverage in the event they cause a car accident that injures or takes the life of another person. However, drivers will have the option to purchase lower limits of $50,000 and $100,000 for this third party car insurance.
  • Factors that cannot be used to set car insurance rates – Michigan No-Fault car insurance companies will be prohibited from using the following non-driving-related factors to set car insurance prices for drivers: (1) sex; (2) marital status; (3) home ownership; (4) education level attained; (5) occupation; (6) the postal zone in which the insured resides; and (7) credit score. This prohibition begins July 1, 2020. Significantly, the law does not specifically prohibit the use of territories or a driver’s credit information, credit report or insurance score.
  • Mini tort – The maximum recovery amount for car accident-related vehicle damage under Michigan’s mini tort law amount will increase from $1,000 to $3,000 for car accidents after July 1, 2020.

Understanding the changes from Michigan No-Fault insurance reform

The changes brought about by Michigan No-Fault insurance reform are far-reaching and complex. They will present challenges both for drivers when they are purchasing car insurance and for car accident victims when they are seeking the benefits and protections provided by the No-Fault law.

It is essential that everyone understand the Michigan No-Fault insurance reform changes so they can make informed choices about coverage and about how to protect their legal rights.

To help drivers and car accident victims, the experienced auto accident attorneys at Michigan Auto Law offer the following resources:

Michigan Auto Insurance Reform Savings Debunked

Drivers have been promised that Michigan auto insurance reform will save them money on their No-Fault car insurance bills. Our attorneys do a deep dive into whether Michigan drivers can expect to see real savings on their auto insurance under Michigan auto insurance reform.

Does Health Insurance Cover Car Accident Injuries in Michigan?

Find out how health insurance works – as compared to No-Fault auto insurance – after a car accident.

Does Medicaid Cover Auto Accident Injuries in Michigan Under New Law?

Medicaid and No-Fault have had a long and complicated relationship. Find out if anything has changed.

Does Medicare Cover Auto Accident Injuries Under New Law?

Medicare and No-Fault have had a long and complicated relationship. Find out if anything has changed.

Qualified Health Coverage (QHC) & Michigan No-Fault Insurance: What You Need To Know

In order for drivers to be able to select certain No-Fault medical coverage levels and options that will become available after July 1, 2020, drivers and/or their family members may need to have health insurance coverage that qualifies as “qualified health coverage.”

Qualifications for Insurance Company IME Doctors

Find out about the “specialty” and “active clinical practice” requirements for insurance company doctors who perform “independent medical examinations” on car accident victims.

How Much Car Insurance Do I Need?

Our lawyers share their No-Fault auto insurance coverage recommendations under Michigan auto insurance reform.

Managed Care Option And Your Michigan Auto Insurance Policy: What You Need To Know

As a result of Michigan auto insurance reform, the No-Fault law now includes a managed care option for consumers looking to buy or renew their insurance policy. Our advice: Drivers should steer clear.

Pedestrian Car Accident: How The New Michigan No-Fault Law Affects Them

Find out how Michigan auto insurance reform affects pedestrians’ rights under the No-Fault law after a car accident.

Motorcycle Insurance in Michigan Under New No-Fault Law

Learn how motorcyclists’ insurance coverage rights are affected by Michigan auto insurance reform.

Is it illegal to use out of state car insurance coverage in Michigan?

What do out-of-state drivers who are driving in Michigan need to know about their rights – and obligations – under Michigan auto insurance reform?

How is attendant care affected by the new Michigan car insurance law?

Find out about the limitations that Michigan auto insurance reform places on in-home, family-provided attendant that is provided after July 1, 2021.

Michigan Mini Tort Law Change: What You Need To Know

How much money can you recover from the at-fault driver for damage to your vehicle under Michigan auto insurance reform?

New Michigan No-Fault Insurance Law Passes: What You Need To Know

Find out how Michigan auto insurance reform has brought about sweeping, historic and unprecedented changes Michigan’s No-Fault law.

Michigan Auto Insurance Reform Deal Announced by Gov. Whitmer

Read the statement from Gov. Whitmer about the deal she reached on Michigan auto insurance reform.

Will Gov. Gretchen Whitmer veto auto insurance reform bills?

Significantly, on May 7, 2020, MLive quoted Gov. Gretchen Whitmer as saying that “If this bill [Senate Bill 1] comes to my desk, I will veto it.” And on May 9th, the Detroit Free Press reported that Gov. Gretchen Whitmer wasn’t “interesting in signing” either SB 1 or HB 4397 “in their current form.” Find out what Gov. Whitmer was saying about Michigan auto insurance reform before she approved it.

House Bill 4397 Passes: Michigan Auto Insurance Reform That Mirrors Senate Bill

A little after 2:00 a.m. on May 9, 2020, the Michigan House of Representatives passed their own version of Michigan auto insurance reform on a 61 to 49 vote.

New Michigan Auto Insurance Reform Bill: What Does It Mean?

Michigan auto insurance reform bill, Senate Bill 1, was passed by the Michigan Senate on a 24 to 14 vote on Tuesday May, 7, 2020. Find out what Michigan auto insurance reform looked like in its initial stages.

Senate Bill 1: All Talk on auto No-Fault

On January 15, 2020, Sen. Aric Nesbitt (R-Lawton) introduced his Michigan auto insurance reform bill, Senate Bill 1. Find out what the “intent” was behind changing Michigan’s No-Fault law.

Injured and need a lawyer after a car accident in Michigan?

If you have been injured and need a lawyer after a car accident in Michigan you can call toll free anytime 24/7 at (800) 968-1001 for a free consultation with one of our experienced attorneys. There is absolutely no cost or obligation. Contact us here to get help from an experienced attorney or you can use the chat feature on our website.

Past efforts at Michigan No-Fault insurance reform

The debate over Michigan No-Fault insurance reform has been a perennially important, controversial and complex topic for many years.

Below is information about the numerous past efforts to change Michigan’s No-Fault law.

House defeats Duggan-Leonard No-Fault insurance plan on 63-45 vote

In the wake of the demise of the Duggan-Leonard-Theis No-Fault insurance plan, lawmakers must make realistic, conscientious strides to lower premiums, preserve benefits

Why auto insurance reform bill HB 5013 is bad for your health

Health insurance study further undermines Michigan auto insurance reform plan to use benefit caps to steer car accident victims toward health-insurer medical coverage

Repulsive Michigan No-Fault bill goes to full House

Insurance-backed Republicans on committee betting that promises of savings in bill will be too tempting for full House to resist

Expect more denials and delays under Duggan No-Fault plan

Duggan-Leonard-Theis plan, HB 5013, gives auto insurers more “excuses” for insurance companies to deny, defend, delay No-Fault benefits to hurt car crash victims

How insurers will be able to harass Michigan doctors

Duggan-Leonard No-Fault bill allows insurance companies to harass doctors who treat injured car crash victims through denial of payments, claims of improper over-utilization, refunds — even threats of criminal charges

Will Michigan doctors stop treating car accident victims?

Uncertainty of payment and insurer harassment under Duggan-Leonard-Theis No-Fault plan will scare doctors away from treating injured auto accident victims

Duggan-Leonard plan makes it tougher to collect overdue No-Fault benefits

The Duggan-Leonard-Theis auto insurance reform plan sets new hurdles for auto lawyers to prove owed No-Fault PIP benefits are overdue; easier for insurers to deny valid claims to consumers; makes it harder for lawyers to sue and bring lawsuits for legally owed and overdue PIP benefits

House lawmakers unite in push for Michigan auto insurance reform

Democrats and Republicans back Michigan auto insurance reform that includes fee schedule, IME oversight & imposing fair dealing/good faith requirement on auto insurers

How the Michigan Chamber of Commerce is failing its members on Michigan No-Fault reform

Michigan Chamber of Commerce president Richard Studley drops the ball on helping Michigan businesses compete, have real savings for drivers; ignores rising health care costs for employers and taxpayers

Mayor Duggan, where’s our 95% in car insurance savings?

Shouldn’t drivers pay 95% less if the Duggan-Leonard-Theis plan is going to allow the insurance companies to slash No-Fault PIP coverage by 95%, instead of letting the insurance companies pocket the difference at taxpayers’ expense?

Crain’s story on “Duggan divides lawyers on auto insurance” is just wrong

Just one lawyer, speaking for himself, supports Duggan-Leonard plan. All other auto accident lawyers unanimously reject Duggan-Leonard-Theis plan

Steve Gursten on Nolan Finley Show dissects  Duggan-Leonard auto insurance reform plan

Flaws and false promises of Duggan-Leonard Michigan auto insurance reform plan exposed

Politicians pushing Michigan No-Fault reform improvement got $250K from insurance industry

Campaign contribution data shows House Insurance Committee Republicans who favor Michigan auto insurance reform have received $253,075 from insurance industry

Takeaways from House Insurance hearing on Duggan-Leonard Michigan No-Fault reform plan

The takeaways from Duggan-Leonard’s Michigan No-fault reform is that car insurance savings come at big cost, including $150 million shifted onto taxpayers, a “$25,000 bridge,”. Also admission that there will be no savings for $500,000 and unlimited No-Fault cap options by Theis

Duggan’s Michigan auto insurance reform to slash family attendant care 66%

For the most seriously injured car crash victims who need attendant care based on a doctor’s 24/7 prescription for safety, with the Michigan No-Fault reform policy Duggan-Leonard want to cap No-Fault attendant care at 2 days max

Duggan’s $25K No-Fault PIP Choice Cap won’t cover medical, wages

How can Duggan, Leonard’s Michigan No-Fault reform Drivers Choice Plan work with a $25,000 cap that fails to even cover the average No-Fault medical claim or one year of wage loss benefits?

Duggan, Leonard No-Fault PIP Cap is $25K — not the $250K they promise

Detroit Mayor says $250K No-Fault PIP Cap, but the truth is $25K is it for car crash victims. “Cornhusker Kickback” of $225K is for the big hospitals for acute emergency care only after car accidents

Duggan, Leonard plan overhaul of No-Fault car insurance

Car accident attorney analyzes key aspects of the Michigan No-Fault reform Driver Choice Car plan advanced by Detroit Mayor Duggan and House Speaker Leonard

Auto insurance reform won’t lower high collision insurance costs

Michigan No-fault reform won’t lower collision insurance costs. Currently, Michigan auto insurers collect $330 million and $150 million more in premiums for collision insurance and comprehensive insurance than they pay out in benefits

Can Michigan No-Fault reform can really bring savings?

We deserve to know savings from Michigan auto insurance reform before politicians in Lansing take away vital benefits and legal protections

Is Fair and Affordable car insurance reform the answer?

House lawmakers’ new Fair and Affordable Michigan car insurance reform legislation a better way to preserve PIP benefits, legal protections for car crash victims

Listen to Steve Gursten discuss auto insurance reform on NPR

Lester Graham of National Public Radio interviews attorney Steven Gursten regarding updates on recent auto insurance reform proposals and how capping medical benefits really wouldn’t lower rates.


Talking auto insurance reform with L. Brooks Patterson

Watch the full discussion in this series of videos as attorney Steven Gursten talks about the benefits of auto insurance reform with Oakland County Executive L. Brooks Patterson.

No-Fault Reform