• Auto Insurance Reform

    On May 30, 2019, Governor Whitmer signed historic bipartisan no-fault auto insurance reform legislation (Public Acts 21 and 22 of 2019) to provide insurance coverage options, lower rates for Michigan drivers while maintaining the highest benefits in the country, and strengthen consumer protections.

    This webpage will be updated to provide the latest information to Michigan drivers.  Please check back often for updates.

    Notice: The information contained within this website pertains to the new auto insurance law. These changes will apply to policies issued or renewed after July 1, 2020.

How the New Law Benefits You

Lower Costs

Personal Injury Protection (PIP) Choice: You will now be able to choose a coverage level that is appropriate based on your needs and budget. PIP covers you and others covered by your policy for medical expenses that result from an auto accident.

Rate Reduction: Each insurance company will be required to reduce average PIP medical premiums. Your premium will depend on your individual circumstances and the coverage you select.

Fee Schedule: A required cost control measure between auto insurance companies and health care providers to make PIP medical coverage more affordable for consumers. The law sets a schedule of fees that can be charged by providers for PIP coverage.
 

Consumer Protections

Elimination of Non-Driving Factors: The new law prohibits auto insurance companies from using sex, marital status, home ownership, credit score, educational level, occupation, and zip codes in setting your auto insurance rates.

Fraud Investigation Unit: A newly-established unit investigates criminal and fraudulent activity related to the insurance and financial markets and works with Attorney General law enforcement to prosecute these crimes.

Michigan Catastrophic Claims Association (MCCA) Transparency: The MCCA is now required to provide an annual report to the Legislature, post an annual consumer statement on their website, and is subject to an audit by DIFS every three years.

Prior Approval: Auto insurance rates and policies must now be filed with and approved by DIFS prior to being offered to consumers.

Fines and Penalties: The new law allows for increased fines on insurance companies, agencies, and licensed agents for certain violations of the law.
 

Additional Changes

Residual Bodily Injury (BI) Coverage: The new law protects you from claims by other injured persons by increasing the minimum BI coverage limit an insurance company is required to offer you.

Mini-Tort: The new law increases the amount of money that can be recovered in small claims court for uninsured damages.

For additional information regarding the new law, click the dropdowns below.

What You Need to Know Now

When Does the Law Take Effect?

The current law requires you to have auto insurance that includes unlimited Personal Injury Protection (PIP) medical coverage to pay for your expenses if you are injured in an auto accident. The new auto insurance law allows you to choose a level of medical coverage when your policy is issued or renewed after July 1, 2020. If you are already receiving payments from your auto insurance policy due to injuries from an auto accident, you will continue to receive the current unlimited benefit regardless of the choice you make for the future. This is also true if you are injured in an accident between now and July 1, 2020.
 

Will My Auto Insurance Bill Be Lower When the Law Goes Into Effect?

The new auto insurance law will allow you to choose a level of PIP medical coverage. Insurance companies are required to reduce the premium for this coverage so that there will be an average reduction per vehicle based on the level of coverage chosen.

You will also have the ability to choose different levels of Bodily Injury and Property Damage (BI/PD) coverage. This choice will also affect your premium.

Your total premium and potential savings will depend on the coverages you select. A licensed insurance agent can help you select the right coverage options for your budget.
 

How Will I Know What Choices I Have and What to Choose?

The new law requires that auto insurance agents and auto insurance companies give you forms that describe the benefits and risks of the coverage options. You may also want to talk with an auto insurance agent to discuss your personal auto insurance needs.

Your Choices

The new law requires that auto insurance companies or licensed agents give you forms that describe the benefits and risks of the coverage options. You may want to consult your auto insurance company or licensed agent to discuss your personal auto insurance needs.

Medical Coverage Options

You will be able to choose the level of medical coverage under the Personal Injury Protection (PIP) portion of an auto insurance policy. Below are the PIP medical coverage levels available to you:

  • Unlimited coverage per person per accident
  • Up to $500,000 in coverage per person per accident
  • Up to $250,000 in coverage per person per accident
  • Up to $250,000 in coverage per person per accident with exclusions (under certain conditions)
  • Up to $50,000 in coverage per person per accident (under certain conditions)
  • PIP opt-out (under certain conditions)

You may wish to discuss your PIP options with your licensed insurance agent.

Increased Bodily Injury and Property Damage (BI/PD) Levels

The law limits the damages that can be claimed against you as the result of an automobile accident, except in certain situations. This portion of your automobile insurance policy will pay up to your coverage limit amounts if you are found legally responsible for damages in these situations.

The new default BI/PD coverage limits are:

  • Up to $250,000 for a person who is hurt or killed in an accident.
  • Up to $500,000 for each accident if several people are hurt or killed.
  • Up to $10,000 for property damage in another state.

You may have the option of purchasing other BI/PD coverage limits. However, the lowest limit you may purchase is:

  • Up to $50,000 for a person who is hurt or killed in an accident.
  • Up to $100,000 for each accident if several people are hurt or killed.
  • Up to $10,000 for property damage in another state.

You may consider speaking with your licensed insurance agent on the options available to you.

Your Rights Under the Law

Consumer Rights

Under the Michigan Insurance Code, you have important rights governing the payment of benefits from your auto insurance company. Upon receipt of an auto insurance claim, Michigan law requires your auto insurance company to do the following:

  • Tell you within 30 days of the auto insurance company being informed of the loss, what information is needed to handle your claim.

  • Pay any part of your claim the auto insurance company has received proper supporting documentation (proof of loss) for and pay the rest of your claim when proper supporting documentation is received.

Personal Injury Protection (PIP) claims, including medical bills, are considered overdue if they are not paid within 30 days after the auto insurance company has received satisfactory supporting documentation. Interest is owed on the amount due at a rate of 12% simple interest.

If your auto insurance claim for damages to a vehicle are not paid within 60 days after your auto insurance company has received satisfactory supporting documentation, the claim may be considered overdue. Interest may be owed on the amount due at a rate of 12% simple interest.

For more information, please review DIFS' consumer publication: Insurance Policies and How to Claim What is Yours.

If you are concerned your auto insurance company is not paying your benefits in a timely fashion or is unfairly delaying or denying your claim, you may file a complaint with DIFS. DIFS will review your concern and will attempt to resolve your complaint and see that your questions are answered.

Shopping for Insurance

Auto insurance premiums vary among insurance companies, so be sure to shop around. Your premium will depend on the coverages you choose and factors related to your personal situation, such as driving record and claims history. Remember when shopping for auto insurance to compare the premiums, limits, and deductibles between insurance companies to ensure that the quotes are comparable.

DIFS encourages you to consult with a licensed agent when purchasing auto insurance.

Complaint Process

If you are concerned your auto insurance company is unfairly delaying or denying your claim, charging you the wrong premium, or otherwise is not performing as required under the law, DIFS is here to help. DIFS encourages you to first attempt to resolve your complaint directly with your licensed agent or auto insurance company. If a resolution cannot be reached, you may file a complaint with DIFS by clicking on the button below. Your complaint will be reviewed based on the documents you submit, so please be sure to include all pertinent information.

Online Complaint Form

 

Once you file a complaint, DIFS will respond to your complaint by doing the following:

  • Contacting the auto insurance company, insurance agency and/or licensed insurance agent to obtain a written response.

  • Confirming the auto insurance company and other licensees named in your complaint are performing as required under your policy and the law.

  • Helping you understand options that may be available to you.

You will receive a copy of all correspondence received during DIFS’ review of your complaint, as well as a letter explaining our findings.

Report Fraud

If you suspect insurance fraud or believe that you have information regarding possible fraudulent activities, you can report it safely, easily and, in most cases, anonymously. Suspected fraud can be reported to DIFS by calling 877-999-6442, by email at DIFS-AntiFraud@michigan.gov or by clicking the button below.

Online Complaint Form

Contact the Department of Insurance and Financial Services

The Michigan Department of Insurance and Financial Services (DIFS) is available to answer your questions about auto insurance.

Contact Information

Hours of Operation Monday - Friday 8:00 AM - 5:00 PM (EST)
Phone Number 877-999-6442 (Toll-Free) or 517-284-8800
Fax Number 517-284-8837
DIFS General Mailing Address DIFS
PO Box 30220
Lansing, MI  48909-7720
DIFS Physical Address 530 West Allegan St.
Lansing, MI 48909
Auto Insurance Questions AutoInsurance@michigan.gov

 

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