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

As you probably know by now, Michigan has recently undergone a massive change in the way auto insurance works. You must now choose from one of the following protection levels to receive no-fault medical benefits for your auto insurance policy 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

Keep reading to learn whether these new requirements will help you save money on your auto insurance.

Saving Money

The old law forced all Michigan drivers to opt-in for unlimited medical coverage, which many people complained made insurance costs too high. Now, you can choose how much medical coverage you’d like, which can potentially save you money.

However, keep in mind that these savings only apply to the Personal Injury Protection (PIP) portion of your insurance bill. This portion of your policy makes up about 35% of the total cost of your no-fault auto insurance. Essentially, the remaining 65% of your insurance costs will be unaffected by the new law.

You May Still Want Unlimited Coverage

Even though you have more options for your PIP coverage under the new law, it may not be wise to elect anything less than unlimited coverage. The benefits of this comprehensive coverage supersede all of the other options.

When you choose the unlimited coverage option, you’ll receive all the medical coverage you need for as long as you live. It is very risky to give up such an inclusive benefit.

Medical costs are often wildly unaffordable, and American healthcare is only getting more expensive year after year. If you endure a severe injury as a result of a car accident, $50,000, $250,000, or even $500,000 will hardly cover your medical costs. You don’t want to be without unlimited coverage in the event you are seriously hurt.

While it’s possible to save some money by selecting a lower coverage amount, the savings won’t justify the reduced protection.

If you thought your auto insurance costs were too high before the new no-fault law, you’ll likely still feel that way. It’s not worth it to significantly reduce your coverage amounts just to save a few bucks. The choice is yours, so choose wisely.

If you’ve been injured in an auto accident through no fault of your own, you may be entitled to compensation. Contact our office right away with any questions you may have.

Call Goodman Acker P.C. today at (248) 793-2010 to discuss the details of your case.

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