What you need to know about Michigan’s new auto insurance reform law
BERRIEN COUNTY, Mich. -- Changes are coming for Michigan drivers and their car insurance! Starting July 2 they’ll no longer be required to have unlimited medical coverage.
A local State Farm agent in Niles, Michigan said the biggest change in the new Auto Insurance Reform law is all the options that are now available.
“The way it used to work is everybody in Michigan received an unlimited benefit if you were injured in a car accident now you have choices. You can still have that unlimited benefit, however, you can cap that,” State Farm Agent David Miller said.
Under the new law, drivers can select their Personal injury Protection coverage or PIP. Options include a cap of $500,000, as opposed to the unlimited, a cap of $250,000 and for those on Medicaid you can opt for a $50,000 benefit and if you have Medicare you can opt-out of the coverage entirely. There will also be a slight increase in minimum liability.
With all these coverage options, Miller said it can be a bit confusing.
“I strongly encourage everybody to sit down with somebody,” Miller said. “Call their agent and really, go through their specific situation and make sure the coverage matches what their family needs.”
Miller said the new law is not relevant to the no-fault policy in Michigan and instead, it’s strictly about car accident injuries and who’s going to pay.
“The thing that has driven the auto insurance up in Michigan is the personal injury, a lot of policies it represents half the expense. So if it was unlimited in the past, and now we’re putting caps, we can eliminate it, that’s a huge benefit,” Miller said.
The law goes into effect on Wednesday, July 1 and the change will be in effect in your auto insurance policy on Thursday, July 2, 2020.