NO FAULT IN A NUTSHELL...Part I
Updated: May 27, 2020
Many of you have been wondering what the upcoming Michigan No-Fault PIP changes will entail and what this means for you. Well I'm here to help answer your questions. The best way to grasp the changes in the new law is to first understand what coverage you have under the existing law.
Currently, Michiganders have UNLIMITED coverage for medical benefits if they are injured in a car accident. Unlimited!!! No limits on dollar amounts or calendar days. If your injuries cause you to have medical bills the rest of your life, currently, that's covered. If your injuries cause you to need modifications to your home and auto, currently that's covered. If you need someone to provide care for you while recovering, that's covered. If you need reimbursement for the mileage to and from the doctor, that's covered.
So, what will be different? Well, now, you will have options. If you want to limit your medical portion on your auto insurance (called Personal Injury Protection, or PIP), you can select different limits. You may still select UNLIMITED PIP (which we recommend) but you will also be able to select lower limits. Other limits offered will be $500,000 and $250,000. You can also select $50,000, but ONLY if you are on Medicaid. Lastly, you can select NO PIP coverage (Option 6) if you have Medicare and everyone in your household has health insurance that does not exclude paying for auto accident injuries.
There is one more option if you have regular health insurance (Not Medicare or Medicaid) that does not exclude coverage for auto accidents. You can select the $250,000 limit, but EXCLUDE yourself and everyone in your household if they have health coverage.
So, you're thinking, "Great! I already have health insurance, I can take that option and save lots of money, right?" But, here's what you need to consider carefully: 1. Your health insurance has LIMITS. Dollar limits, copays, deductibles, coverage limitations, etc. YOU will have to pay the difference if you are injured. Before you consider that a 'reasonable risk', re-read the beginning of this article. Your health insurance is not going to cover all of those costs, it ONLY covers your medical bills. No coverage for mileage, no coverage to remodel your home or refit your car if you have permanent injuries. And, what happens if your injuries cause you to lose your job, and subsequently, your health insurance? Guess what, no more coverage for that auto accident injury, even if you have ongoing care needed. Remember the current unlimited PIP coverage on your auto? It will pay for that injury as long as it's needed, even if you no longer have that policy in force. Standard health insurance doesn't work that way, if the policy ends, your coverage ends.
So weigh the costs, for you and your family. If you are single, you are deciding just for yourself, but if you have a family, you are making decisions that may affect the care your loved ones may need due to an auto accident. Weigh your choices very carefully, and remember, we are here to help!
Next time, I'll delve into additional parts of the new No Fault law. Until then, as always, I'm still yet...
Your Agent, Nancy