LANSING, Mich. — The Michigan Department of Insurance and Financial Services has reached an agreement that ensures unlimited Personal Injury Protection medical coverage for uninsured vehicle occupants and pedestrians who were injured in car crashes before the July 2020 implementation of the state’s new auto insurance law.
“Michigan’s historic, bipartisan auto insurance law is protecting consumers and saving Michiganders money, and we are committed to ensuring that every Michigander receives the insurance benefits to which they are entitled,” Gov. Gretchen Whitmer said. “I am pleased that DIFS was able to lead the way to find a solution that works for all involved. After this agreement, these Michiganders can rest easy that they will continue to receive the medical coverage provided under Michigan law.”
Advocates for survivors of major car crashes had warned that the state’s no-fault auto reform law would negatively impact access to medical care many of them need to survive.
“The premature imposition of a $250,000 cap could have severely impacted the lives of Michigan drivers and uninsured passengers, pedestrians and bicyclists,” DIFS Director Anita Fox said. “As always, DIFS is here to help consumers and we will continue to do everything possible to ensure Michiganders have the insurance protection they are entitled to receive.”
In Michigan, Personal Injury Protection medical coverage pays for medical care, recovery and rehabilitation when people are injured in auto accidents.
Previously, uninsured non-drivers – such as passengers and pedestrians – were entitled to received unlimited PIP medical coverage through the Michigan Assigned Claims Plan, which is administered by the Michigan Automobile Insurance Placement Facility.
Under Michigan’s new auto insurance law, this coverage was capped at $250,000 for claims incurred starting July 2, 2020.
Uninsured non-drivers injured between June 11, 2019 – when the new law was enacted – and the law’s July 2, 2020, effective date had faced uncertainty about their coverage limits because of differing interpretations of the new statute.
To address the issue, DIFS issued an order clarifying that the MACP was required to provide unlimited PIP medical coverage to those uninsured non-drivers who were injured before July 2, 2020.
The MAIPF then filed a lawsuit in the Michigan Court of Claims seeking to overturn the DIFS order and to allow this coverage to be capped.
The Michigan Court of Claims upheld the DIFS order and, under the terms of the settlement, MAIPF dropped an appeal it had filed.