Michigan Personal Injury Lawyers Fighting For The Injured

Will I See Savings on My Car Insurance Bill Under the New Michigan No-Fault Law?

On May 30, 2019, Governor Gretchen Whitmer signed a bill into law aimed at reducing insurance costs for Michigan’s motorists. The new insurance coverage options granted by the bill officially go into effect on July 1, 2020.

Michigan drivers must now choose one of the following levels of protection to receive no-fault medical benefits for all auto insurance policies issued or renewed after July 1, 2020:

  • $50,000 in medical coverage
  • $250,000 in medical coverage
  • $500,000 in medical coverage
  • Unlimited medical coverage
  • Opt-out of no-fault medical coverage altogether

Under the old law, motorists had to opt for unlimited medical coverage, which included attendant care and had no caps or limitations on coverage. However, many complained of the high insurance costs associated with unlimited coverage, so now drivers can choose how much coverage they want, potentially saving them money.

However, the promised savings are limited only to the Personal Injury Protection (PIP) portion of your insurance bill. Therefore, any savings a driver will see are limited to this small portion of your costs—roughly 35% of your no-fault bill. This means that 65% of your auto insurance bill will be completely unaffected by the new law.

So, what are you giving up? Unlimited lifetime medical benefits for only a few dollars of savings.

At Goodman Acker, our Detroit car accident lawyers recommend that all motorists continue to elect the unlimited lifetime option. The benefits of this comprehensive coverage far outweigh any of the other options. Why?

Under the unlimited coverage option, you are entitled to as much medical coverage you need—for life. Giving up that incredible benefit is incredibly risky. Medical costs can be staggering, especially if you get into a serious accident that results in a permanent injury or wrongful death. An amount as low as $50,000, $250,000, or even $500,000 will barely cover your medical costs if your injury is severe. Unlimited coverage is your only safe bet in such a scenario.

We completely understand the temptation to elect a lower coverage amount on your insurance policy in an effort to save money. Now that you are free to choose, you can select whichever plan you believe works best for you. However, our legal advisors believe that the savings from choosing a lower coverage amount are too small to justify choosing a lesser option over unlimited coverage. If you already felt as though your car insurance was too costly before the changes went into effect, you will likely still feel that way now because the savings are so minuscule. Ultimately, the choice is yours.

Do you have more questions about car insurance coverage under Michigan’s new no-fault law? Read more by visiting our Michigan’s New No-Fault Law Explained page or contact our Detroit car accident lawyers for more information.