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Is Michigan a no-fault car insurance state?

Here's what you need to know...
  • No-fault car insurance allows the policyholder to recover losses from their insurance provider; fault is not taken into consideration during this process
  • Michigan is a no-fault car insurance state, which means any policy issued in Michigan will carry this coverage
  • In Michigan, the minimum, no-fault coverage you purchase must have Personal Injury Protection, Property Protection, and Residual Liability Insurance; these will be discussed in more detail
  • It’s important to consider the additional coverage choices you may need, which means assessing your risks and how a loss would affect you if one occurs
  • Before making your final decision, speak to multiple providers so you can compare multiple quotes; each provider is different and may offer different pricing or options

No-fault car insurance is a term used to describe different car insurance policies that let the policyholder recover from losses through their insurance carrier; fault does not figure into this claim.

No-fault insurance helps to reduce the amount of time and money that gets tied up in the legal system by reducing the opportunities for valid lawsuits to occur.

Conversely, a tort car insurance policy is one where the driver that is responsible, or at fault, for the incident will be held responsible; this includes medical expenses, property damage, and additional damages.

Currently, the 38 states that do not operate under a no-fault system use the tort system, meaning the coverage requirements vary compared to no-fault states.

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When it comes to no-fault insurance policies and tort insurance policies, the biggest difference is how the policyholder recovers from a loss or which provider they file a claim through. Under tort policies, the at-fault party’s provider is responsible for resolving the loss and restoring the victim to their pre-loss conditions.

Under no-fault policies, the policyholder normally claims their loss under their insurance policy; there are unique circumstances that may warrant claims against the at-fault party.

Is Michigan a no-fault state?


Currently, Michigan has legislation in place that requires any car insurance to be a no-fault insurance policy; policyholders here do not have a choice regarding their policy type.

Michigan is one of the 12 states that currently operate under a no-fault system, which will limit your ability to bring a lawsuit or claim against the responsible party; there are exceptions to this based on the severity of your experienced loss.

Michigan is considered a no-fault state that operates with verbal thresholds, meaning there is not a dollar amount that must be met for a covered loss. This verbal threshold means that suits can only be brought in specific instances, such as death or lifelong impairment.

There are compulsory insurance requirements for any car insurance purchased in Michigan, which include having Personal Injury Protection (PIP), Property Protection (PPI), and Residual Bodily Injury and Property Damage Liability (BI/PD) coverage.

These three requirements make up the mandatory requirements for a no-fault car insurance policy; each will be touched on in more detail further down.

If you are involved in an accident or file a claim in a no-fault state, you will normally encounter a more straightforward, simplifies claim filing process. This starts by submitting the claim to your insurance provider, regardless of where the fault lies, and they will then settle your claim without taking fault into consideration.

These claims are usually quick to resolve when there is not a serious loss due to the lack of fault consideration being figured into the claim resolution.

However, this means the types and amounts of compensation you qualify for are limited; pain and suffering claims, for instance, are not available under these policies. This means that car insurance-related lawsuits are reserved for serious incidents, alleviating strain on the legal system.

Auto Insurance in Michigan


Michigan state law requires that every policyholder purchase certain levels of coverage before they can get their license plates; it is illegal to drive your car or to let others operate your car without this insurance coverage in place.

Although the minimum requirements do not protect your car in the event it is damaged, it does help protect you if you are responsible for a serious loss.

As mentioned earlier, the minimum requirements for coverage including purchasing Personal Injury Protection (PIP), Property Protection (PPI), and Residual Bodily Injury and Property Damage Liability (BI/PD) coverage before getting behind the wheel.

Each of these basic coverage options protects other drivers you are sharing the road with while protecting you from losses you may be responsible for; this only applies up to your policy limits.

  • PIP provides payments for medical expenses deemed reasonable and necessary when you are injured in an accident, including lost wages and replacement services, for up to three years after the incident.
  • PPI provides payments for damages you may cause to someone’s property in Michigan, such as buildings or fences, up to $1 million under a covered loss.
  • BI/PD provides payments for your defense costs and damages you are found liable for in a serious incident, limited only by the limits of your policy. This coverage carries a minimum of $20,000 per injured person, $40,000 per accident, and $10,000 for property damages outside of Michigan.

When buying coverage through a provider in Michigan, they will often discuss the minimum requirements with you during the quoting process. This helps ensure you are aware of what coverage you must purchase, as well as how this coverage applies in different situations.

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There are extra or optional coverage choices that you can add to your policy; this includes purchasing higher limits on your mandatory coverage options or adding in additional coverage choices.

Your basic no-fault policy will not protect your car from physical damages that occur during an accident, an unexpected incident, theft, or vandalism. Purchasing collision coverage or comprehensive coverage can help protect you in the event of an accident or a non-accident related loss.

These coverage options may require an insurance deductible, which is a portion of the covered loss that the policyholder absorbs to reduce the amount the insurance carrier is responsible for covering.

Additionally, there is coverage available for uninsured or underinsured motorists, which are drivers that do not carry coverage or do not carry enough coverage to protect your property or injuries in a loss adequately. This coverage may also protect your vehicle if it is damaged due to a hit-and-run.

Another option you may add is coverage for rental cars or for towing your vehicle.

Rental car coverage helps provide you with a vehicle if your primary car is damaged by a covered loss event. Towing or emergency roadside coverage helps provide you with assistance in getting your car towed to a safe location or in providing roadside assistance if needed.

Michigan offers a limited property damage liability insurance, sometimes referred to as mini-tort coverage, which helps protect you in the event you are over 50% responsible for an accident. This coverage helps to protect you from these types of losses.

When you are looking at purchasing car insurance coverage, make sure to consider coverage quotes from multiple insurance providers.

Each provider offers different premium rates for different coverage options, and this can vary based on your address, your previous driving record, and several other factors. Comparing similar quotes from different sources will help you gauge what coverage you need and what price will fall within your budget.

Finding the Best Car Insurance Coverage in Michigan


As mentioned previously, it’s important to look at multiple insurance carriers when you are searching for coverage; different providers will assess your risk factors and your needs differently, so quotes can help you evaluate each provider.

Make sure to check with each carrier about discounts or premium reductions they offer, as these can vary from provider to provider.

Additionally, different providers may offer different discounts based on your driving record, your student record, the anti-theft devices or steps you’ve taken, and even driver education you have completed.

There are discounts that you may qualify for without even realizing it, such as a multi-vehicle or multi-line discount for having more than one insurance policy with the same provider.

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