Michigan Auto Insurance, Explained
Michigan auto insurance laws and regulations have undergone significant changes over the past several years, and many drivers may not be aware of how these changes affect them. If you’re looking to renew your auto insurance or add coverage for a new vehicle or a young driver, take a few minutes to learn the basics.
The Basics of Auto Liability Insurance in Michigan
Michigan is a no-fault auto insurance state, which means all Michigan drivers must carry various types of coverage.
Mandatory Types of Car Insurance
Residual Bodily Injury and Property Damage (BI/PD): Protects drivers if they are legally responsible for any accident that causes bodily injury or property damage. Michigan requires a minimum of $50,000 per person and $100,000 per accident; the default on most policies is between $250,000 $500,000. The minimum property damage coverage is $10,000.
Personal Injury Protection (PIP): Covers your medical bills and lost wages, regardless of whether you were at fault for the accident. PIP coverage can be quite low, especially if you qualify for Medicare or Medicaid.
Property Protection Insurance (PPI): Pays for damages caused by you or your vehicle in the state of Michigan, including buildings, fences, or parked cars. It is mandatory to have PPI coverage of at least $1 million.
What Is the Bare Minimum Car Insurance in Michigan?
Often abbreviated as 50/100/10, the bare minimum car insurance in Michigan will meet the following criteria:
$50,000 in bodily injury liability, per person, per accident
$100,000 in total bodily injury liability, per accident
$10,000 in property damage liability per accident
Most experts strongly recommend adding coverage well beyond the minimum. Default plans provide substantially more coverage, though they come with higher rates and premiums. When you’re given a quote, it will likely be based on the 250/500/100 limit default, which is:
$250,000 in bodily injury liability, per person, per accident
$500,000 in total bodily injury liability, per accident
$10,000 in property damage liability per accident
What Happens If You Get Pulled Over Without Insurance?
Michigan has serious consequences for drivers without insurance. In most cases, you’ll pay more in fines than you would have for getting basic insurance coverage. Depending on your driving history and other factors, the punishment for driving without a license will likely include:
Fines: In addition to a ticket, you’ll pay a fine up to $5,000.
Lose your license: You may lose your license until you have adequate insurance or for a pre-determined period.
Vehicle impoundment: Your car may be towed to an impound lot, forcing you to pay towing and storage fees.
Jail time: For repeat offenders, driving without a license may result in jail time.
Crucially, suppose you are in an accident without insurance. In that case, you will be personally responsible for all damages, your own medical bills, lost wages, any property damage, and all relevant costs and damages experienced by other drivers. The financial toll for driving without insurance is potentially astronomical; it’s not worth it.
Occasional Driver Insurance Coverage
You can get liability insurance without a car if you don’t drive very often.
Using a Household Car Occasionally
Most insurance companies can allow members of a household to be labeled as occasional drivers. For example, your teenage son may only borrow your car to get to work when it’s raining. The occasional driver must drive the car less than 25% of the time.
Only Driving a Car Temporarily
If you only drive a car that you own seasonally (think classic cars, or only during the winter, you can get short-term car insurance through most insurance providers.
It’s worth noting that if you drive someone else’s car, you may be covered by their policy. It’s important to ask about their coverage and understand the changes to liability this arrangement may cause.
Always talk to your car insurance provider to learn about your policy. Resources like AAA, the State of Michigan, or a trusted insurance agency in your area.
Keeping Michigan Moving
Garfield Auto is dedicated to helping Northern Michigan families stay on the move. We offer professional, affordable automotive repairs and preventative maintenance to keep your family rolling. Take the stress out of auto service; schedule your appointment with us today.