If a person sustains bodily injury in a car accident caused by the fault (i.e., negligence) of another motorist, the Michigan No-Fault Act permits the victim to pursue a liability claim. This liability claim (also called the tort claim) permits the victim to recover compensation for two distinct types of damages: excess economic loss and noneconomic loss. These two types of damage claims will be discussed in greater detail in this section.
In order to successfully pursue a liability claim for either noneconomic loss or excess economic loss, the injured person must first prove that the other driver was, to some significant extent, at fault for the accident. The legal word for fault is negligence, which is nothing more than the failure to act as a reasonably careful person would act under the same or similar circumstances. Violations of the Michigan Motor Vehicle Code, including speeding, failing to stop at a stop sign, failing to yield, running a red light, improper lane usage, etc. are all evidence of negligence. If both the injured party and the other driver were, in some way, negligent in causing the accident, the injured party may still recover damages, but the amount of those damages will be reduced by the percentage of the injured party’s fault. This is referred to as comparative negligence.
An accident victim who has a valid liability claim under the Michigan No-Fault Act is entitled to be compensated for that claim by the insurance company of the negligent party. If litigation is required to enforce that claim, the lawsuit must name the negligent party. However, the damages are actually paid by the negligent party’s insurance company up to the amount of liability insurance coverage carried by the negligent party. If the damages exceed the negligent party’s liability insurance coverage, the negligent party may be personally responsible for the excess.
In addition, if the person causing the accident was uninsured or did not carry enough insurance to fully compensate the victim for these types of damages, the victim can recover these damages from their own insurance company if the victim purchased optional uninsured and/or underinsured coverage.
Learn more about uninsured and underinsured motorist coverage.