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Understanding Michigan Auto Insurance

MichiganAutomobile policies in the Wolverine State are quite expensive when compared to other states and in some cases motorists pay extremely high rates. The reason for this is pretty simple; the state has one of the most comprehensive No-Fault insurance systems in the nation. In order for a resident to operate a motor vehicle legally, they must be insured with a policy consisting of quite extensive coverage. A basic No-Fault policy is made up of three parts and each require pretty high limits.

Individuals purchasing automobile policies must purchase Property Protection which comes with a limit of $1 million to cover property damage that a motorist may cause with their vehicle. This will compensate a third party for damages that are caused to property such as buildings, fences or a properly parked automobile. However, this does not pay for damage to cars that are being operated. Along with property protection, motorists must also purchase Michigan auto insurance that includes Residual Liability coverage for bodily injury and property damage. The minimum limits that must be obtained are $20,000 for bodily injuries or death to one person, $40,000 for bodily injuries per accident and $10,000 for property damage in another state; higher limits may be purchased.

Additional Information About MI Car Insurance

Motorists in the state are also required to purchase Personal Injury Protection (PIP) to cover the injuries sustained by an insured. If a policyholder is injured in an automobile accident PIP will pay all of the medical costs for the insured. This will also pay up to 85% of income that the injured person would have earned if they had not been hurt in a collision for up to three years. The maximum amount that can be paid to a policyholder is revised annually and as of October 1, 2010 it was raised to $4,929 from the previous amount of $4,828. If the insured is killed in a traffic accident, these benefits will be given to household family members for any income that would have been received for up to three years.

Additionally, the insured is also entitled to $20 a day for replacement services. This is used to pay for services that a person can no longer perform due to the injuries suffered in the traffic accident. Such services include, but are not limited to such activities as housekeeping or landscaping. Residents should also be aware that a No-Fault policy covers all family members who reside in the same household and PIP will cover injuries sustained when in another person’s automobile or if involved in a traffic accident as a pedestrian. According to the publication, Brief Explanation of Michigan No-Fault Insurance basic policies do not cover any damage caused to the insured’s vehicle and additional coverage must be obtained to protect against potential losses. Although automobile policies are expensive in the state, they do provide extensive protection.

Source: http://www.onlineautoinsurance.com/michigan/