To drive legally in Michigan, state law requires the purchase of no-fault automobile insurance. This includes Personal Injury Protection benefits, often referred to as “PIP.” In general, this includes medical bills, medical mileage, attendant care, work loss, and replacement services.
This area of the law is governed by the Michigan No-Fault Act. On June 11, 2019, the No-Fault Act underwent several changes. One of those changes included providing the consumer with options to choose different amounts of PIP medical coverage. Prior to reform, PIP medical coverage was unlimited.
This allows for the consumer to decide as to the amount of PIP medical coverage that they would like to have. In turn, this impacts the amount of money paid towards the insurance premium. Effective July 2, 2020, the following options are available:
Option 1: Unlimited Coverage. This election pays for all allowable expenses for car, recovery, and rehabilitation for injuries from an automobile accident. This option is the same PIP coverage prior to reform and provides the most protection.
Option 2: Limited Coverage of $500,000.00. This election provides limits of $500,000.00 per person per accident for injuries from an automobile accident for PIP medical. If this PIP medical limit is reached, you may need other health insurance coverage or may be responsible for paying expenses. The insurance carrier must offer excess attendant care coverage.
Option 3: Limited Coverage of $250,000.00. This election provides limits of $250,000.00 per person per accident for injuries from an automobile accident. If this PIP medical limit is reached, you may need other health insurance coverage or may be responsible for paying expenses. The insurance carrier must offer excess attendant care coverage.
Option 4: Limited Coverage of $250,000.00 with some or all persons excluded from PIP medical. To select this coverage, the following must be met:
1. The named insured who is excluding PIP medical has qualified health coverage that is not Medicare; AND
2. Any resident relative or spouse who is excluding PIP medical has qualified health coverage.
Option 5: Limited Coverage of $50,000.00. To select this coverage, both of the following must be met:
1. The applicant or named insured is enrolled in Medicaid; AND
2. Any spouse and all resident relatives have qualified health coverage or are covered under another auto policy with PIP medical coverage.
Option 6: No PIP medical coverage for anyone. To select this coverage, both of the following must be met:
1. The applicant or named insured has coverage under both Medicare Parts A and B; AND
2. Any spouse and all resident relatives have qualified health coverage or are covered under another auto policy with PIP medical coverage.
It should be noted that PIP coverages, which include wage loss, replacement services, and funeral and burial expenses, are still included in your automobile insurance policy regardless of your PIP medical election.
