The Wolverine State follows a No-Fault auto insurance system that is designed to protect residents extensively following a traffic accident regardless of which party is found responsible of fault. Motorists much purchase three basic types of coverage to be in compliance with Michigan’s laws which include Personal Injury Protection (PIP), Property Protection (PPI) and Residual Bodily Injury and Property Damage Liability (BI/PD).

The state requires that all motor vehicles registered must be insured, and although the cost of coverage can be quite expensive, especially in cities such as Detroit, failure to comply with Michigan car insurance requirements can become much more of a hassle than maintaining a policy. Individuals caught without automobile coverage can be convicted of a misdemeanor and fined from $200 to $500, or sentenced to jail for up to one year or both. A thirty day license suspension can also be issued by the court which may be lifted by providing proof of an active policy. In addition to these consequences, being in an uninsured driver involved in an automobile accident can make the situation much worse; the motorist may be held liable for all injuries and damages resulting from the accident and can be subject to a lawsuit.

What Required Michigan car insurance Covers

The main reason why the cost of automobile coverage in MI can be quite expensive is that aside from requiring three types of protection, the amount of compensation included with the minimum policy requirements are extensive and cover policyholders for major expenses that may arise from a traffic accident. The Property Protection (PPI) portion of a policy will pay up to $1,000,000 for damage a motorist causes while operating their automobile to another party’s property. It will also cover damages to another person’s properly parked vehicle although it does not pay for any other damage to cars.

Bodily Injury and Property Damage Liability must be purchased with the minimum amounts of $20,000 for bodily injury to one person, $40,000 for bodily injury per accident and $10,000 for property damage in another state. This type of coverage is usually necessary in the case that the insured causes an accident where somebody is killed, seriously injured, permanently disfigured, or a non-resident is involved in which case they may not have Personal Injury Protection (PIP) to cover their injuries. This will also cover property damage caused by the insured while in another state.

Personal injury protection is quite extensive and will provide very helpful benefits should one need it. Included in the coverage is compensation for all medical and rehabilitation costs, 85% of income that was not earned due to the injuries sustained up to $4,878 a month for up to three years and $20 a day in replacement service to pay for services that the insured cannot perform such as yard work and housekeeping. As one can see, the cost of policies may be high in MI, but come with quite a bit of protection. For more information one can view a publication titled, Brief Explanation of Michigan No-Fault Insurance provided by the state which also explains mandatory No-Fault and optional coverage that is available.