Michigan No-Fault Auto Insurance Reform
This page explains personal injury projection coverage, PIP coverage options and how those options may affect you.
What is personal injury projection coverage?
Generally speaking, personal injury projection coverage is a component of auto insurance that covers medical expenses of people injured in auto accidents regardless of who caused the crash.
What are my coverage options?
You five PIP coverage options, enabling drivers to keep unlimited PIP or choose less coverage. These are the options.
Unlimited PIP Coverage
- Covers unlimited, lifetime car accident injury expenses.
- Impact on PIP Portion of Auto Insurance Rate: 10 percent reduction
$500,000 of PIP Coverage
- Covers car accident injury expenses up to $500,000.
- Impact on PIP Portion of Auto Insurance Rate: 20 percent reduction
$250,000 of PIP Coverage
- Covers car accident injury expenses up to $250,000.
- Impact on PIP Portion of Auto Insurance Rate: 35 percent reduction
$50,000 of PIP Coverage
- Covers car accident injury expenses up to $50,000.
- This is the lowest coverage option you may choose if your medical insurance is through Medicaid.
- Impact on PIP Portion of Auto Insurance Rate: 45 percent reduction
Opt-Out of PIP Coverage
- You may only opt out of PIP coverage if you have Medicare or qualifying health insurance that covers auto accident injuries.
- Impact on PIP Portion of Auto Insurance Rate: 100 percent reduction
What else should I keep in mind?
We know what you’re thinking. Those reductions are pretty attractive and it’s tempting to choose the cheapest option available. We get it. We’re Michigan drivers who have to pay for auto insurance too — just like you.
Here’s what we’re keeping in mind and want you to think about too:
- You pay for PIP coverage so your auto insurance covers you and your passengers’ injury expenses after an auto accident.
- Choosing a lower coverage limit can reduce the cost of your auto insurance, but if you’re injured in an accident, medical expenses will be paid only up to the limit you choose.
- It’s important to understand how your medical insurance addresses injuries from auto accidents. Before placing limits on your PIP coverage, review your medical insurance plan. When it comes to care for injuries from auto accidents, medical insurance deductibles, coinsurance and copays will apply. Don’t be shy about reaching out to your medical insurance carrier for help understanding the details of your plan. You should be able to find their customer service contact information on your insurance card.
- PIP benefits are generally paid without requiring a copay or deductible. A penalty deductible might apply if you choose excess Allowable Expenses (Medical) benefits and it’s later determined that your medical insurance doesn’t pay primary on auto accidents.
What does Keyser recommend?
We recommend that you purchase the highest level of PIP coverage you can afford.
- The medical coverage and benefits you are able to collect under a Michigan auto policy could be broader than the coverage you’re eligible for under your current employer-sponsored medical plan for auto injuries.
- For plans with high deductibles, you would be responsible for paying the deductible out of pocket before your health insurance would kick in and pay.
- In catastrophic claims where the person is injured and unable to return to work, you would eventually lose your employer-sponsored health insurance.
When do I need to decide?
You don’t have to decide until your auto insurance policy renews. About 60 days before your renewal date, your carrier will mail (or email if you’re signed up as “paperless”) Bodily Injury and Personal Injury Protection election forms. You’ll need to fill them out and return them to the carrier, so it’s important to pay attention to mail and email you get from them.
If you want to make a change sooner than that, you should contact your agent to talk about your options.
This is a lot of information. I’d like to talk it through with someone.
Understanding how all the puzzle pieces fit together can be a challenge. That’s why we’re here — to take care of you. Please reach out to an agent with any questions.
If you have a friend or family member who could also use some help, we’re here for them too. Have them give us a call at 877-381-3570 or let us know so we can get in touch.