Michigan’s no-fault auto insurance law is unlike any other state in the U.S. While most states use an at fault system, and other no-fault states feature low mandatory coverage minimums, Michigan is the only state that requires drivers to carry significant amounts of no-fault insurance coverage. (If that sounds confusing, don’t worry—we’ll explain it in a little more depth below.)
One consequence of Michigan’s no-fault system is that at-fault drivers are much more protected against potential lawsuits than they would be in other states. However, these protections don’t apply to every car accident in Michigan, and there are many situations when suing the at-fault driver is not only possible, but necessary if you want truly fair compensation for your serious injury.
In this blog, we’ll take a closer look at Michigan’s no-fault law, what it covers (and doesn’t cover), when and why an accident victim should consider suing the other driver, and how a Grand Rapids personal injury lawyer can help.
Michigan No-Fault Law: The Basics
What Does It Mean to Be a “No-Fault Insurance State”?
In a no-fault state like Michigan, after an accident you first (and sometimes only) file an insurance claim with your own insurance company, and they will be responsible for paying your medical expenses and wage loss benefits—regardless of who caused the accident.
This is in contrast to “at fault” or “negligence” states, in which the auto insurance company of the at-fault driver has primary responsibility to pay those benefits. You would only turn to your own auto insurance company if the at-fault driver wasn’t carrying enough insurance to fully cover you.
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What Are the Pros and Cons of No-Fault Insurance?
On the plus side, no fault insurance is supposed to make it easier for injury victims to get the money they need for medical bills and lost wages right away, even if they caused the accident. It spares the hassle of filing with the other driver’s insurance company (at least initially) and reduces the number of car accident claims that need to go to court to get resolved.
The biggest downside is that no-fault insurance benefits only go so far, and don’t cover everything that a third-party claim would cover in another state. No-fault insurance does not provide any pain and suffering compensation, and makes it more difficult for innocent car accident victims to obtain those benefits from an at-fault driver unless specific conditions are met.
What Does No-Fault Insurance Cover?
No fault insurance is also known as personal injury protection, or PIP insurance. No-fault benefits in Michigan are designed to cover purely economic losses resulting from a car accident, and include coverage for:
- Medical bills. By Michigan law, this includes any reasonably necessary medical costs associated with the accident, including treatment, services, products, home and vehicle modifications, and even transportation to appointments.
- Lost wages. Your auto insurance will cover up to 85% of your gross pay (up to a monthly maximum) for three years following the accident.
- Attendant care. No-fault coverage provides an allowance for nursing care, either in home or at a facility.
- Replacement services. Injury victims can receive up to $20 per day to pay for domestic services (housekeeping, cleaning, cooking, etc.) they are no longer able to perform.
What Isn’t Covered by No-Fault Benefits?
As noted above, no-fault benefits very conspicuously leave out coverage for any non-economic damages. And that is a huge problem if you’re an innocent accident victim dealing with serious injuries caused by a negligent driver.
To truly make an injured person whole after a car crash, you can’t just add up all the past and future medical bills and lost wages and call it good. Your car accident injury may have caused significant physical and emotional pain, permanent changes in your mobility or cognitive function, or permanent changes in the lifestyle you’re able to lead.
No-fault benefits do not address any of these.
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When Can I Sue an At-Fault Driver in Michigan?
To successfully sue an at-fault driver in Michigan, you need to be able to show two things:
The Other Driver Was Primarily Responsible for the Crash
Like other states, Michigan’s definition of negligence has three basic points. In order to be held responsible for a Michigan car accident, you must show that the at-fault driver:
- Owed you a duty of care. This is fairly straightforward—drivers are expected to follow the rules of the road and be considerate of others.
- Breached that duty of care. In other words, the driver took an action that a reasonably careful person would not—speeding, driving distracted, driving under the influence, driving carelessly, etc.
- Caused damages to you. In order words, their actions resulted in you suffering unpaid medical bills, physical pain and suffering, mental anguish, excess wage loss, and other damages.
Additionally, more than one person could be responsible for a crash—for example, one driver was speeding while another rolled a stop sign.
Under Michigan law, you can only recover damages in a lawsuit if your share of the fault is 50% or less. Furthermore, if you are partially at fault, the amount of compensation you can recover will be reduced by the same percentage. (In other words, if you’re 30% responsible, you can only get 70% of your claimed damages.) This is known as “modified comparative fault.”
Your Injuries are “Serious Enough” to Bring the Claim
In order to obtain pain and suffering compensation in a Michigan car accident claim, the injury needs to be severe enough to have caused any of the following:
- Permanent serious disfigurement. This would include things like loss of limbs, serious scarring (sometimes a surgical scar), or other external, visible damage to your appearance.
- impairment of body function. Broadly speaking, this means the injury causes an impairment that can be perceived by someone other than the injured person, and the injury impairs your ability to lead your normal life.
- Death. If a loved one passes away in a car accident that wasn’t their fault, family members can bring a wrongful death suit against the at-fault driver (or any other responsible parties).
An injury that meets this standard is commonly known as a “threshold injury.”
You Are Still Within the Statute of Limitations
In Michigan, car accident lawsuits must be filed within three years of the date of the accident. If you wait too long, you will lose your right to sue. (Notably, you only have one year to file a claim or lawsuit for no-fault benefits.)
What Damages Can I Recover in Michigan if I Sue an At-Fault Driver in Michigan?
You should strongly consider making a claim against the at-fault driver if you’re legally entitled to damages that aren’t covered by your no-fault benefits. These include:
- Excess economic loss damages. If your medical expenses and lost wages exceed the limits of your own insurance, you must sue the at-fault driver to recover more.
- Excess wage loss. Michigan’s no-fault coverage only includes 3 years of wage loss benefits. If you expect to be unable to work for longer than that, you’ll need to file a claim against the other driver to recover additional lost income—even if you have unlimited lifetime no-fault benefits.
- Non-economic damages. As outlined above, Michigan no-fault insurance does not cover pain, suffering, or any other kind of losses that aren’t strictly financial in nature. If you’ve sustained a “threshold injury,” there is simply no way to get fair compensation for your injuries without making a claim against the other driver.
- Vehicle damage repair costs. Under Michigan’s “mini tort” law, you can claim up to $3,000 for your out-of-pocket expenses to repair or replace your damaged vehicle. If you have collision coverage as part of your insurance policy, you can still file a mini-tort claim to recover the deductible.
How a Michigan Car Accident Attorney Can Help
Insurance companies frequently contest no-fault benefits, often by arguing that you aren’t really as injured as you say you are, and that certain medical tests or treatments aren’t necessary.
And if your car accident injuries were severe enough to cause significant pain, stress, and disruption to your life, your only option to get any sort of compensation for these non-economic losses is to make a claim, and potentially file a car accident lawsuit, against the at-fault driver. It probably goes without saying that insurance companies defend themselves against these claims aggressively, and to get fair compensation you will need to know what your case is truly worth and build a strong case with significant supporting evidence.
An experienced attorney can help you understand your legal options, fight unfair claim delays and denials, and handle all aspects of your claim—investigating the crash, negotiating with the auto insurer on your behalf, and defending your legal rights (including in court, if necessary).
CBH Attorneys & Counselors: West Michigan Personal Injury Lawyers with Big Law Firm Results
Many people are worried that they can’t afford an attorney to help with their car accident case, but nothing could be further from the truth. Your initial consultation and case review with CBH Attorneys & Counselors is always free—and you don’t pay us anything unless, and until, we win.
Furthermore, a CBH attorney can not only help you maximize your financial recovery, but make sure you get the care you deserve at every step of the process. We’ll handle the investigation, the paperwork, the negotiations, answer all your questions, and even help you settle any outstanding medical debt. You should be focused on getting better; we’ll take care of the rest.
To request your free consultation, just fill out our simple contact form or give us a call at (616) 608-3061 for our Grand Rapids or Kalamazoo office.
The content provided here is for informational purposes only and should not be construed as legal advice on any subject.