Your Guide to Car Insurance Coverage in Michigan
Purchasing car insurance coverage is mandatory in the state of Michigan. If you are stopped by a law enforcement officer, you must be able to show proof of insurance. To a
void problems in showing proof of insurance, keep a current financial responsibility card in your vehicle at all times. This card has important information about your policy that will show law enforcement officers that you are in compliance with the law. If you don’t have insurance or you are unable to provide proof of insurance, you can be found guilty of what is known as a civil infraction and can have your driver’s license suspension for 30 days or until you provide proof of coverage on the vehicle in question.
It is mandatory for drivers in Michigan to get no fault car insurance. No fault insurance requires the insurance company to pay an insured driver’s accident expenses regardless of who was at fault in the accident. The liability insurance coverage that a motorist carries must be no-fault coverage.
This insurance policy is composed of three parts – Personal Injury Protection (PIP), Property Protection Insurance (PPI), and Residual Liability Insurance, Bodily Injury and Property Damage (BI/PD):
Personal Injury Protection (PIP): This insurance coverage will be responsible for paying for medical cost that you may incurred if you get involved in a car accident. It will also cover you for loss of wages for a period of three years. As of 2008, the allowed amount for PIP/ month is $4,713.
Property Protection Insurance (PPI): This insurance coverage will pay for the damages that you have caused to other party’s property. The maximum amount that this coverage would pay is $1 million.
Residual Liability Insurance – Bodily Injury and Property Damage (BI/PD): The no-fault law in the state of Michigan protects the driver from being sued because of a car accident. However, there are some conditions where the driver can still be sued:
- If the driver is involved in an accident which causes death or serious injury to another person.
- If the driver is involved in an accident where the other party is not a resident of Michigan
- If the driver is involved in an accident that happened outside the state of Michigan.
- If the driver is 50% or more at-fault in the car accident.
The minimum coverage limits for Bodily Injury and Property Damage is described as 20/40/10 and are as follows:
- Up to $20,000 for every person hurt or killed in the accident
- Up to $40,000 for every accident if there are many people hurt in the accident
- Up to $10,000 for damages on properties.
Michigan’s penalties for lack of proper car insurance are severe. You must maintain financial responsibility on you car and show proof if you are stopped. In Michigan driving without insurance is considered a misdemeanor and you can be jailed for up to a year or required to pay a fine of $500.00 if you are convicted of driving without insurance.
In some cases, courts may required at-fault party to pay more than what is included in the your minimum car insurance coverage therefore it is recommended that you buy more than what is required by the law in Michigan.
Don’t take chances, in order to avoid these penalties, maintain the proper insurance coverage on your vehicle at all times.
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