Michigan Auto No-Fault Insurance Reform – A 6 Month Recap

A lot has happened in the Michigan auto no-fault insurance debate since we last wrote about it. For drivers in the state, this debate, and any potential reform to its current laws, affects all of us. As a law firm representing the seriously injured in auto, semi-truck, and motorcycle accidents in the state of Michigan, no-fault touches almost every case we handle. Because of this, many of our attorneys have dedicated their entire careers to understanding the ins and outs of this complex system.

This topic is important, so it’s time to bring you up to speed. Here’s a brief overview of what’s happened in the no-fault insurance debate so far this year.

2018 Developments in the No-Fault Insurance Debate

February 2018
House Republicans introduced House Bill 5517 and House Bill 5518. These packages of bills would essentially put an end to auto no-fault as we know it and replace it with a pure tort liability state. Here’s how this affects you:

  1. Michigan car accident victims will only be able to sue the at-fault driver for all economic and non-economic losses.
  2. car dashboard The at-fault driver, therefore, becomes responsible for the injured party’s lost wages, medical expenses, attendant care, and vehicle damages.
  3. Michigan drivers will no longer be entitled to catastrophic injury coverage. However, they will still have to pay annual assessments to the Michigan Catastrophic Claims Association.
  4. Michigan drivers will only be required to carry liability insurance in 20/40/10 policy limits. This means if you’re in an accident under the new tort liability scenario and sue the at-fault driver, they are only required to pay up to their cap of $20,000 in medical expenses.

June 2018
Michigan Senate passed Senate Bills 1014 and 787. These bills essentially reduce the protective benefits catastrophically injured individuals receive and shift the cost of care onto taxpayers. Here’s what this looks like:

  1. Senate Bill 1014 seeks to cap the cost of care, no matter the seriousness of the injuries, to $400,000.
  2. Senate Bill 787 offers what’s known as a “carve-out” for senior citizens, which is presented as a benefit but in actuality severely decreases their protections. Essentially, this bill will encourage drivers 65 years and older to opt-out of their current unlimited no-fault policies and PIP benefits in return for a policy with a $50,000 cap on all damages – including medical expenses, attendant care, and wage loss.
  3. Greatly reduce the payment to attendant caregivers, including family members. This means if you’re catastrophically injured and need round-the-clock care requiring a family member to stay home with you, they will receive significantly less in compensation.

The fall legislative session is mere weeks away and several no-fault insurance bills are up for debate, including those previously mentioned. There is much work to do to ensure Michigan residents continue to receive the protections and benefits from the state’s no-fault system. This is a system worth fighting for. And while we are all for lowering the cost of auto insurance in Michigan, that shouldn’t come at the price of making sure you and your family are protected in the event you are seriously injured in a motor vehicle accident.