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Cheap Car Insurance in Michigan

Here's what you need to know...
  • In Michigan, you’re required by law to carry no-fault auto insurance that pays for unlimited medical expenses
  • If you don’t insure your vehicle, you could be fined up to $500 or ordered to serve up to one year in jail
  • No-fault coverage include Personal Injury Protection, Property, and Residual Bodily Injury and Property Damage
  • You’re not required to buy physical damage coverage but it’s an option if you need help paying for repairs
  • Make sure to look for a licensed insurer in Michigan that is financially stable and dedicated to customer service

Michigan has a unique auto insurance laws. If you’re moving to the state or you’re thinking about purchasing a car, the first thing you need to do is research the laws and familiarize yourself with your individual needs.

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You can’t effectively shop for a value-priced policy if you don’t know what you’re buying. Here’s a consumer guide so that you can find cheap car insurance in Michigan:

Why do you need auto insurance?

If you’re the legal owner of a vehicle that’s registered in The Great Lakes State, you have to comply with Michigan’s auto insurance laws. Since auto insurance is the law, you have no option but to know what’s required before you buy a car or register a car in your name.

The key is to find the right balance between how much coverage you’re required to have and how much coverage you need. When you’re driving a car down the I-77 to Erie or you’re on your way home, you can’t predict whether or not you’ll crash into someone.

Having insurance gives you the protection you need to pay for damages without having to pay for it with your own money.

Michigan Auto Insurance Requirements

Every state has a different type of insurance law. Your state will operate under either a tort law or a no-fault law. Michigan is one of the 12 states in the country with a no-fault system.

Out of the 12 states with no-fault laws, Michigan is the only one that requires coverage for unlimited medical expenses. Here are the minimums required by law on cars in Michigan:

  • Personal Injury Protection (PIP) – no-fault coverage that pays for all reasonable and necessary medical expenses when you and your family members are injured in an accident
  • Property Protection (PPI) – offers $1 million of coverage to pay for third-party property repairs if you damage property while driving in Michigan
  • Residual Bodily Injury Liability (BI) – minimum coverage pays for $20,000 per person, $40,000 per accident in Bodily Injury coverage if you’re found liable for injuring someone in an auto accident in another state
  • Residual Property Damage Liability (PD) – minimum coverage pays for up to $10,000 in damage to property owned by others if you get into an accident in another state

Not only are you required to carry no-fault auto insurance and residual liability coverage, you’re also required to furnish proof of auto insurance to law enforcement officers whenever they request proof.

Make sure that you always have an up-to-date auto insurance identification card in your car at all times or you could be fined.

How to Search For a Cheap Auto Insurance Policy in Michigan

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Since you’re required to carry unlimited medical expense coverage on your auto insurance, it’s no surprise that Michigan ranks second on the list of most expensive states to buy auto insurance in. According to premium data collected from carriers across the state, the average policy costs $1227 per year.

Since the average premium in Michigan is almost $400 more than consumers pay nationwide, shopping around has never been more important. The only way to truly be an informed consumer is to get referrals, research carriers, and compare multiple quotes.

Every company has its base rates for drivers in different classes. By getting quotes from at least four companies, you can see which insurers have the best rates in your niche.

Price is important, but when you’re shopping around to find the best deal on cheap car insurance in Michigan, you also have to consider the company’s reputation. Here are things to look for in Michigan insurers:

– Financial Stability

You need to choose a car insurance company that knows how to manage its money. If a company doesn’t charge you the right rate, it probably isn’t charging the next driver the right rate either.

Low rates could be enticing, but they could also be a sign that the company isn’t collecting enough money to cover risk exposure.

You need to look at financial stability before ever looking at premiums. There are third-party consumer agencies that look at public financial records and rate companies based on how able the carrier is to pay for claims. You can get the grades and rating information you need through A.M. Best or Moody’s.

– Licensing

Insurance companies have to be licensed to sell insurance in the same state where your car is registered.

You have to check the licensing status of a company before you buy insurance from it just to be sure that it is active. If it’s not, the coverage that you’re paying for might not be accepted, and you definitely won’t be protected.

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What are the additional coverage options?

Michigan has the highest minimum coverage requirement in the country, but that doesn’t mean that you don’t need more than just the basics. You should also consider additional coverage options and higher Residual BI and PD limits.

Some coverage options that you can select include:

  • Comprehensive and Collision – required for physical damage protection if your car is leased or financed
  • Uninsured Motorist – pays you if someone without insurance seriously injures you in an auto accident
  • Rental Car – pays for you to replace your car temporarily while it’s being repaired
  • Roadside Assistance – coverage for tows, tire changes, and jump starts

What factors influence your rates?

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You won’t pay what your friends or family pay for insurance. Different factors will either increase or lower your risks. There are factors that are beyond your control and others that you can control.

Here are some factors that are determinants used to calculate your premiums:

  • Age, gender, marital status
  • Driving history
  • Credit Score
  • Vehicle
  • Zip Code
  • Claims record

Discounts You Should Look For

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If you’re a high-risk driver or you have an expensive car, look for discounts to get cheaper car insurance. You can drive your premiums down significantly if you take advantage of savings. Here are some auto discounts you can’t ignore:

  • Multi-car
  • Multi-line
  • Good student
  • Good driver
  • Experienced driver
  • Driver training

Getting cheap car insurance should be a priority. Check out companies that have proven to be reputable in the marketplace and then compare rates. When you’re ready, you should shop around online and get at least four quotes to make an informed purchase.

Enter your zip code below to find the best car insurance rates in Michigan today!

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