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July 1st has passed, and there are new options for Michigan drivers regarding their auto policies: unlimited PIP is no longer required. Here's the skinny:
Old Rules:
Old Rules:
Policy was required to have unlimited medical benefits for the lifetime of the injured person when those injuries result from an auto accident. The cost of care, rehabilitation and recovery was covered under PIP Allowable Expenses — and the coverage was essentially unlimited.
Due to rising medical costs, unlimited PIP has caused expensive auto coverage. In fact, Michigan has the 4th most expensive auto insurance in the country.
If you’re at-fault for an auto accident and someone else gets injured, they can make Bodily Injury (BI) claims against you for non-economic damages, such as pain and suffering or excess work loss.
New Rules:
New Rules:
Michigan drivers now have a choice in their level of PIP coverage. Under the new law, drivers will be able to choose from up to six options for Personal Injury Protection coverage.
Options:
Unlimited (what MI drivers currently have)
$500,000 limit
$250,000 limit
if you have Qualified Health Care (QHC), Medicaid or Medicare:
$250,000 limit with PIP exclusion: People who qualify for this option will not be charged a PIP premium by their auto insurer. If an individual chooses this option, and they are injured in an automobile accident, their medical benefits will be covered by their QHC provider. QHC is health or accident insurance that does not exclude or limit coverage for injuries related to auto accidents and has a deductible of $6,000 or less per person.
$50,000 limit available to Medicaid insureds only
Allowable Expenses Exclusion available to Medicare insureds only: In order to choose a $0 PIP limit, an insured must be enrolled in Medicare Parts A and B. Insureds will be required to provide documentation showing that they are eligible in order to elect this option.
If you’re at-fault for an auto accident and someone else gets injured, the injured party can also make BI claims for Personal Injury Protection Allowable Expenses (PIP AE) against you if those expenses are higher than their own PIP AE limit.
considerations:
considerations:
Individuals should confirm with their health insurance carrier whether they have QHC, AND whether their health insurance will pay primary or secondary in the event of an auto accident.
Individuals need to consider the potential of not having enough medical coverage in the event of a catastrophic auto injury.
Unlike auto insurance, health insurance may stop paying when the policy ends (termination from employment) or is cancelled.
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