While every motor vehicle is required to have no-fault insurance to operate legally in the State of Michigan, it never ceases to amaze us how few people understand what the no-fault insurance they buy covers. While the no-fault laws have changed considerably, the general principles in these FAQs still apply:
If I Was Not at Fault for the Accident, Why Should My Insurance Company Have to Pay?
Our personal injury attorneys at the Davis Law Center get this question from Michigan and Detroit car crash clients almost every week. The answer is that Michigan No-Fault insurance provides certain benefits to auto accident victims regardless of fault. These benefits are primarily economic benefits covering things like wage loss, medical bills and payment for services for activities you may no longer be able to perform as a result of your accident. Compensation for “pain and suffering” however would be paid by the at-fault driver’s insurance company.
Who Is Eligible for No-Fault Benefits?
Persons involved in an accident involving a car, truck, or bus will most likely be afforded no-fault coverage. However, owners of uninsured vehicles involved in accidents are not eligible for no-fault benefits nor are they able to recover compensation from the at-fault driver for pain and suffering type damages.
Are Motorcycles Covered Under the No-Fault Act?
Generally, the answer is “no.” The No-Fault Act applies to vehicles with more than two wheels, powered by something other than muscular power and designed to be driven on public roads. Since motorcycles only have two wheels, injured operators of motorcycles are not covered. If however, the motorcycle is hit by a motor vehicle, the motorcyclist can usually obtain no-fault benefits from the motor vehicle’s insurance company, with a couple of exceptions that a qualified and experienced Detroit personal injury attorney can explain. Prior to July 1, 2020, this coverage would have been unlimited and lifetime coverage. Effective July 1, 2020, the injured motorcyclist’s coverage will depend on how much no-fault coverage the owner/operator of the motor vehicle obtained.
What About Pedestrians Struck by a Motor Vehicle?
A person seeking No-fault benefits in Michigan generally looks to his own insurance first for payment of benefits. If he/she does not have automobile insurance, the insurer next in line would be that owned by the victim’s spouse or any relatives living in the same household at the time of the accident. If there is still no coverage from a spouse or resident relative, the uninsured pedestrian now must seek benefits through the Michigan Assigned Claims Plan and benefits are capped at only $250,000. Before the new no-fault laws went into effect June 11, 2019, an uninsured pedestrian was able to obtain benefits through the striking vehicle’s automobile insurance policy with lifetime benefits available for all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person’s care, recovery or rehabilitation.
What Kinds of Benefits Are Available Under the No-Fault Act?
These benefits can include payment of hospital and doctor bills, physical therapy, chiropractic treatment, home nursing services (professional or family provided), assistance with household chores, transportation to and from medical appointments, vehicle and home modifications, etc. Prior to July 1, 2020, these benefits were unlimited and were payable for life as long as they were still reasonable and necessary as set forth in MCL 500.3107(1)(a). Effective July 1, 2020, insurance companies can begin offering coverages in the following amounts: $50,000 (if Medicaid recipients and household members have other auto or health insurance that would cover auto accident injuries), $250,000, $500,000, and unlimited coverage. Medicare beneficiaries whose household members have auto insurance or health insurance that would cover auto accident injuries can opt out of no-fault coverage altogether.
Insurance companies in Michigan sell two kinds of polices related to medical benefits; coordinated and uncoordinated. If you purchased a coordinated policy and you have health insurance too, in most cases you must treat within your network and submit your medical bills to the health insurer first. If the health insurer does not pay or only pays a fraction, then the no-fault insurance kicks in. If you purchased uncoordinated coverage for a slightly higher rate, you don’t need to worry about this and you can submit your bills to the auto insurer, health insurer, and sometimes both.
The new no-fault law establishes fee schedules for medical providers starting July 1, 2021 which are unreasonable and financially oppressive; the effect is that many facilities that treat seriously injured accident victims will go out of business and many good doctors will be forced to turn away auto accident victims. MCL 500.3157.
Work Loss Benefits
If the injuries you suffer in the accident force you to miss time from work, the No-fault Act provides for payment of 85% of your gross wages up to three (3) years after the accident subject to a cap on the maximum amount you can receive over a thirty day period that is adjusted annually.
Replacement Services (Household Services)
Under the Michigan No-Fault Act, injured persons are entitled to replacement care services. Replacement services are those things that the injured person would have performed for himself, herself, or their dependents, had it not been for his/her injury, and include, but are not limited to, such activities as laundry, cutting firewood, cooking, raking leaves, shopping, shoveling snow, house cleaning, mowing the lawn, babysitting, taking out the trash, household repairs, painting and mechanical work. You are entitled to a maximum of $20.00 per day for replacement services and these benefits last for up to three years after your accident.
Attendant Care (Home Nursing Services)
As discussed above, attendant care services are considered a medical expense. As such, they are not limited to a certain maximum charge per day. Generally, attendant care benefits are paid at an hourly rate that takes into account the skill level of the caregiver as well as the type of care the accident victim requires. Attendant services may be performed by anyone and the person providing the services does not need to be a trained professional. Attendant services include activities a licensed practical nurse would perform including, but not necessarily limited to getting medications, changing dressings, bathing, dressing, physical therapy, preparing special meals, hot packs, soaks, massage, supervision, helping in and out of bed, move about the house, helping in and out of the chair or car, etc. Presently, there is no limit on the hours per day an insurance company is responsible for reimbursing an attendant care provider. Of course, the insurance companies received another gift from the new no-fault law that will limit friend and family attendant care to only 56 hours per week effective July 1, 2021.
The No-fault Act also pays for transportation to and from your medical appointments necessitated by the accident. If you drive yourself or a friend or family member drives, it is important to keep track of your mileage. Once submitted to the insurance company, it is obligated to pay a certain amount per mile, the amount of which changes annually. Transportation companies can also be utilized and they generally submit their own bills to the insurance company for payment.
If a car crash results in death, the No-fault act provides for payment of a minimum of One Thousand Seven Hundred Fifty ($1,750.00) dollars for funeral expenses. You do have the right to purchase up to Five Thousand ($5,000) dollars in additional coverage from your insurer however for a nominal charge.
Survivor’s Loss Benefits
In the event of an automobile-related death, Survivor’s Loss Benefits are also recoverable under the Michigan No-Fault Act. These benefits are designed to provide support for the dependents of the person killed in the automobile accident and are paid in the amount the dependents would have received plus up to $20.00 per day for Replacement Services discussed above. These benefits have a monthly maximum that is adjusted yearly and lasts up to three years following the accident.
As you can imagine, insurance companies are not always thrilled to pay these benefits and will sooner than later terminate some or all of them, regardless of need. An experienced Detroit car accident attorney can assist you in obtaining the benefits you require despite the games the insurance companies tend to play. This summary just scratches the surface of the Michigan No-Fault Act. Please call the Davis Law Center at 248-865-7740 for a free consultation.