All About Michigan No-Fault
In the state of Michigan, all drivers are required to carry no-fault car insurance. Michigan isn’t the only state with a no-fault law, but Michigan’s no-fault law is unique. In fact, Michigan has often been called the only truly no-fault state in the country.
All Michigan drivers are required to carry auto insurance that covers a minimum of $20,000 per person hurt in an accident, $40,000 per accident where more than one person is hurt or killed, and $10,000 per accident to cover property damage. With a no-fault insurance, your own insurance covers your benefits, even if you aren’t at fault, which makes it possible to receive your benefits much more quickly than you would be able to otherwise. Since your claims are handled by your own insurance, you don’t have to wait to settle disputes with the other party’s insurance company. There are only a few circumstances in which a person can sue the other driver or get compensation from their insurance, so it’s in your best interest to consult an attorney if you’ve been in a serious car accident.
What makes Michigan’s no-fault law completely unique is the fact that people who are injured in car accidents can receive unlimited health care for as long as it is needed. Michigan is the only state in the country to offer this kind of protection. This way, a person severely injured in a car accident and left with permanent injuries will be cared for for the rest of their life.
Michigan no-fault also provides compensation for other expenses that are reasonably related to the accident, such as physical therapy, medication, home assistance, modifying a home to make it more accessible, and for mileage for going to and from doctor appointments. In addition to covering all medical expenses, no-fault benefits pay injured parties up to 85% of their lost income for no more than three years and $20 a day for someone to assist an injured person with household chores they are unable to do themselves. Although health care benefits are not limited, lost wages are capped at $4,929 per month. Even if you were unemployed and looking for work at the time of the accident, you may still be eligible for some lost wage compensation.
Have you ever looked at your auto insurance bill and seen a fee for something called the MCCA? The MCCA is the Michigan Catastrophic Claims Association, which is responsible for covering most of the no-fault benefits for the most serious car accident injury cases. Under Michigan no-fault, medical claims up to $500,000 are handled by auto insurance companies and anything beyond that first $500,000 is covered by the MCCA. Every insured driver in Michigan pays an annual fee of $186 per car to the MCCA as part of their insurance. The fees collected are put in a fund that is used to cover those catastrophic claims.
Michigan has had their no-fault law since 1973 and was intended to help injured people get the benefits they need more quickly. However, there are a number of critics who believe that Michigan’s no-fault law is unfairly driving up the cost of auto insurance. Michigan currently has the second highest auto insurance prices in the country, just behind Louisiana. Lawmakers have recently tried amending the no-fault law to put an end to the unlimited lifetime health care benefits and cap benefits at $1 million, but those efforts have stalled for the time being.