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Michigan Auto Insurance Reform 2020

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Michigan Auto Insurance Reform 2020
By Peter Baker
Posted on 12/3/2019 8:02 AM

What No-Fault Insurance Means

When a car accident occurs, who pays?

If you are in a car accident, your auto insurance provider pays for your insured costs, no matter who is at fault. The general intent of No-Fault insurance is to provide prompt and certain payment for accident victims rather than going to court to determine who caused the accident and who should compensate the victim for their injuries.

Mandatory coverage in Michigan

Michigan’s No-Fault system remains the broadest form of protection of any auto insurance system in the country, and Michigan law requires that all motor vehicle owners carry No-Fault insurance. This unique mandatory coverage includes:


Personal Injury Protection

Michigan requires the purchase of unlimited Personal Injury Protection (PIP), providing for unlimited lifetime medical benefits regardless of fault.

Residual Bodily Injury

Residual Bodily Injury provides coverage for injuries caused to another person or persons for whom you are liable.

Property Damage Liability

Property Damage Liability covers damages to property that you cause with your vehicle outside of Michigan.

Property Protection Insurance

Property Protection Insurance pays for damage your car does to another person’s property or parked car in Michigan.

                 Michigan Auto Insurance Reform 2020

Auto insurance reform goes into effect July 2020 with regard to the selection of PIP options.


Beginning in July 2020, Michigan drivers will be able to select their preferred level of Personal Protection Insurance—commonly known as Personal Injury Protection, or PIP—that pays for medical coverage if you are injured in an auto accident. Based on your eligibility and individual needs, you’ll be able to select from the coverage options available or you may be able to waive PIP medical coverage altogether.


What new PIP Medical coverage options are available in July 2020 with the new law?


There are several choices available under the new law for Personal Injury Protection (PIP) coverage options, but the law imposes certain requirements that may limit your options. Here is a summary of the options that will be available, plus a summary of the eligibility requirements for several selections:

  • Unlimited (with Michigan Catastrophic Claims Association involvement)
  • $500,000
  • $250,000
  • $50,000 - This option is available if the insured is enrolled in Medicaid and their spouse and any relative of either who resides in the same household has qualified health coverage, is enrolled in Medicaid, or has PIP medical coverage under another Michigan policy.
  • $0 (Waive PIP medical coverage on auto policy) - This election by an insured to not maintain PIP medical coverage is available if the insured has Medicare, and if  their spouse and any relative of either that resides in the same household have qualified health coverage or have PIP medical coverage under another Michigan policy.


Peter Baker Insurance Agency, LLC

Peter Baker, Insurance Agent Principal

297 N Zeeb Rd

Ann Arbor, MI 48103


Peter Baker Insurance Agency LLC Web Link