Michigan Auto Insurance Laws
Auto Insurance Laws and Trends in MI
Michigan is one of the states that have chosen to implement the no-fault system of auto insurance. In the event of an accident, no-fault insurance mandates that each insurance company must pay for injuries and damages to third party property, regardless who is responsible. Expenses such as medical costs, funeral costs, loss of wages, and damages to homes, fences, structures, and legally parked vehicles are covered.
The Michigan no-fault insurance system
No-fault insurance will not pay for damages to the insured's vehicle. You cannot sue the other party except in the following cases:
- You are responsible for an accident that has resulted in one or more fatalities
- You are involved in an accident with a non-Michigan resident in another state.
Uninsured motorists and Michigan
Today's flailing economy, coupled with the high unemployment rate, has led to a large number of motorists choosing to drive uninsured vehicles. Many of them cannot afford the high costs of auto insurance and so they are opting to cancel their insurance policies or allow them to lapse. The number of uninsured drivers across the country has doubled in the last 10 years and by 2010, it is predicted that at least 1 out of 6 motorists will be driving uninsured vehicles.
According to a Newschannel 3 story that originally aired on April 24, 2009, Michigan has a higher percentage of uninsured drivers than many of the other states in the country. There are approximately five million drivers on the road in the state, and about 1 million of them are driving without valid insurance.
Because of this fact, it is more important than ever to carry higher than minimum liability coverage , as well as carry under/uninsured motorist coverage. This coverage will protect you if you are involved in an accident with a driver who doesn't carry adequate insurance or who doesn't have any insurance coverage at all. Otherwise, you will be required to pay all expenses out of pocket.