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Know the Law: Lost Income After a Car Crash

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Know the Law: Lost Income After Car Crash
Posted at 11:07 AM, Nov 01, 2021
and last updated 2021-11-01 11:07:09-04

With so much talk about Michigan’s new auto insurance that was passed in 2019, one point that is often overlooked in the discussion is the issue of lost income for survivors of Michigan car crashes. Grand Rapids auto crash attorney, Tom Sinas, breaks down how people injured in serious crashes may receive compensation if they’re unable to return to work this week for us.

According to the No-Fault Act, injured victims of a car accident who can't work can receive up to three years' worth of work loss benefits. The statute defines work loss benefits as compensation for “loss of income from work an injured person would have performed during the first three years after the date of the accident if he or she had not been injured.”

Work loss benefits are payable at the rate of 85 percent of gross pay. However, there are monthly maximum limits, which are adjusted in October of every year to keep up with the cost of living.

Michigan courts have held that a no-fault insurance company cannot reduce wage loss benefits by an injured person’s sick leave, vacation time, or employer-paid wage-continuation benefits. Therefore, if an injured person is receiving sick pay or is drawing on vacation time during a period of disability, the no-fault insurer must pay full no-fault wage loss benefits.

The No-Fault Act contains a special provision for those persons who are considered “temporarily unemployed” at the time of an auto accident injury. This provision states: “Work loss for an injured person who is temporarily unemployed at the time of the accident or during the period of disability shall be based on earned income for the last month employed full time preceding the accident.”

Self-employed accident victims are entitled to recover wage loss benefits but, oftentimes, experience great difficulty with insurance companies in establishing the appropriate level of benefits.

Learn more by calling Sinas Dramis Law Firm at (616)-301-3333 or visit sinasdramis.com.

Know the Law is sponsored by Sinas Dramis Law Firm. Information is provided by Sinas Dramis Law Firm.