In all likelihood, if a person resides in the state of Michigan the chances are that their rates for automobile coverage are among the highest in the nation; as a matter of fact, residents in the city of Detroit pay extremely high premiums to insure their vehicles and in some cases it can be somewhat unaffordable to own an automobile. There is one major reason why premiums in MI are so high and it is because the state has the most comprehensive no-fault car insurance system in the country; this in turn requires motorists to purchase high levels of coverage which translates into increased rates.
Although many disagree with how expensive Michigan auto insurance can be, it does provide a lot of protection for residents and policyholders and is worth paying for if intending on operating a vehicle. It is against the law for any vehicle owner to operate or allow someone else to operate the automobile without having at least the basic no-fault coverage. Failure to comply can end in a fine ranging from $200 to $500, or the owner can be put in jail for up to one year or both; if an accident occurs, the vehicle owner can be held liable and sued for damages; in addition, a license can be suspended for 30 days or until valid proof of coverage is provided to the courts.
The required coverage in the Wolverine State is quite extensive and is intended to adequately cover motorists in the event of a traffic accident. Michigan’s no-fault policies are broken down into into three basic parts; Personal Injury Protection (PIP), Property Protection (PPI) and Residual Bodily Injury and Property Damage Liability Insurance (BI/PD).
Personal injury protection pays for all necessary medical costs for a policyholder caused in a traffic accident. This protection will also pay up to 85% of the income the insured would have earned if they had not been injured for up to three years at a maximum of $4878 per month and if the insured is killed in the accident the family will receive the income for the three years. The $4878 limit went into effect on 10/1/09 and is revised annually. Policyholders may also be entitled to $20 a day for services such as housekeeping and yard work.
The second part, property protection, pays up to $1 million for damage the policyholder causes to another party’s property such as buildings, fences and another person’s properly parked vehicle, but not for vehicles involved in moving collisions. Lastly is bodily injury and property damage liability which pays for injuries and damages caused by the policyholder in which they are found legally responsible; motorists must carry minimum liability limits of $20,000 for bodily injury per person, $40,000 for bodily injury per accident and $10,000 for property damage in another state.
Although the cost of insuring a vehicle in MI can be expensive, policies come with a wide range of protection and are quite complex. Residents should read the state publication titled, Brief Explanation of Michigan No-Fault Insurance to help better understand their rights and coverage requirements.
Source: http://www.onlineautoinsurance.com/michigan/
