home » resources » how does the michigan no-fault law affect my claim?
Michigan has no-fault laws regarding car accidents, which means your own auto insurance will cover costs related to injuries, regardless of whether or not you were at fault in causing or contributing to your accident. While no-fault laws are intended to limit the number of people facing lawsuits and make the state court system more efficient, these laws can have a significant effect on your injury claim after a car accident.
This has never been more true than after July 2020, when a renewed no-fault insurance law went into effect in Michigan. These changes complicate the system through no fault of their own, as consumers have more coverage options. it also complicates the process of seeking full compensation for many injured motorists, and we hope to see more third-party claims in the future.
Regardless of what type of no-fault coverage you have in Michigan, the claim process can be challenging and stressful. You should allow the michigan car accident lawyers at michigan injury lawyers to handle this process for you. The following are just a few ways the no-fault laws in Michigan can affect your claim.
summary of no-fault changes in michigan
Since 1973, most drivers in Michigan only had the option to purchase unlimited no-fault coverage.
Under the amended law, Michigan drivers now have a choice of one of the following:
- unlimited personal injury protection (pip) coverage
- pip coverage limited to $500,000
- pip coverage limited to $250,000
- pip coverage limited to $250,000 with certain medical exclusions (if you qualify)
- pip coverage limited to $50,000 (if you qualify)
- opt out of pip coverage altogether (if you qualify)
- physical pain and suffering
- emotional distress and mental trauma
- loss of enjoyment of life
- permanent disfigurement or disability
- you buy a $250,000 pip policy
- Your serious injuries in an accident caused by a distracted driver that resulted in losses of about $380,000
- Your no-fault coverage must cover up to $250,000, and you must file a third-party claim against the distracted driver for the remaining $130,000
Most drivers will need to choose unlimited or limits of $500,000 or $250,000. Having limited coverage will certainly change the claim process for seriously injured car accident victims.
Filing a first party claim with your own insurance company
In many states, a victim injured in an accident caused by someone else’s negligence would file a claim with the responsible party’s insurance company. however, no-fault laws require that you instead seek recovery from your own insurance company for your medical bills and other losses arising from your injuries. You must do this by filing a PIP claim with your insurer. this process is quite different from other failure-based states.
You pay premiums to your insurer, so you should expect the company to give you benefits when you file a claim. however, this is often more complicated than it seems. People often face challenges when trying to get all the benefits they need through a first party claim. You will still need to prove the seriousness of your injuries and justify your medical treatment, missed work and other losses in order to receive adequate coverage. There may also be other sources of coverage, such as health coverage, that come into play, further complicating matters.
This is the last thing you have to deal with while recovering from an injury, so let our car accident attorneys handle the first-party claim process for you.
recovery may be limited
Unfortunately, your no-fault insurance policy may not fully cover all of your losses, especially if your injuries were serious. For example, no-fault policies do not compensate policyholders for non-economic damages caused by their injuries.
Non-economic damages may include:
In cases involving relatively minor injuries, the unavailability of non-economic damages may not be an issue. however, if your injuries are serious or even catastrophic, you deserve to recover more than just your financial losses.
In addition, if you selected a limited coverage policy after July 2, 2020, and you sustain catastrophic injuries, your medical bills and other losses could exceed your $250,000 or $500,000 limit. In this situation, it is critical that an attorney evaluate your options to recover any remaining losses.
third party claims
In many other states, injured accident victims always have the right to file a personal injury lawsuit against the negligent parties who caused the collision. In Michigan, however, no-fault laws limit the rights to sue the negligent party to those who have suffered serious injuries.
If you need to seek damages for pain and suffering and similar non-economic damages, you may only be able to sue for the full range of your damages if your injury caused serious impairment or disability in your life. Michigan law always has a “liability threshold” for recovering non-economic damages through a third party claim, and this remains true after the law has changed.
We will likely see an increase in third party lawsuits in Michigan due to changes in no-fault laws. If an injured motorist has a limited policy, he will now be able to sue an at-fault driver for his losses that exceed his policy limits.
In a third party claim, you must prove negligence and liability on the part of the other driver, which can be difficult. You always want the right attorney to represent you during this process.
Contact our michigan car accident lawyers for help
While no-fault laws may seem harsh, in previous years, they have generally made the claims process more streamlined and efficient. however, with the new pip options, the process of getting full compensation for your losses can become significantly more complicated. additionally, injured victims in atypical cases may face numerous challenges in the recovery process.
The legal team at michigan injury attorneys handles complex auto accident claims, whether a case involves first-party no-fault claims, third-party claims based on fault, or both. If you have any questions about your car accident claim, feel free to call (888) 454-0801 today or contact us online.