How Michigan no-fault insurance works

If you are injured in a Michigan automobile accident, you will most likely be eligible to receive no-fault insurance benefits. These benefits are payable regardless of who was at fault for the accident.

The types of benefits you are entitled to receive include the following:

  1. Medical Expenses. This includes all expenses arising from the accident that are reasonably necessary for your care, recovery and/or rehabilitation. This includes doctor and hospital bills. It can also include such items as transportation costs to see doctors, home modification costs for those severely injured who need modifications to live in their home, and home health care expenses related to your accident.
  2. Wage Loss. This benefit compensates you for employment income you would have received but for injuries received in the accident. The amount of the benefit is normally 85% of the total income you would have received but for the accident. Wage loss can be payable for up to three (3) years.
  3. Replacement Costs. These are expenses not exceeding $20.00 per day incurred in obtaining necessary services in lieu of those that, if you had not been injured, you would have performed for yourself or for a dependent of yours. For example, if you mowed your yard before you were injured, but you now have to hire someone to mow your yard after your injury, this would be a replacement cost. This benefit is payable for up to three (3) years.
  4. Survivor’s Loss Benefits. These are benefits paid to surviving dependents of a person fatally injured in an automobile accident. These benefits include financial support that dependents would have received from the deceased plus up to $20.00 per day for replacement services. This benefit is intended to replace the contribution of all tangible things of economic value the dependents would have received from the deceased. This benefit is payable for three (3) years after the date of the accident. The computation of the amount of this benefit is complicated and is subject to setoffs, such as social security survivor’s loss benefits. Therefore, you should seek the advice of an attorney to calculate the amount of this benefit.
  5. Funeral and Burial Expenses. Each no-fault policy must provide a funeral benefit of not less than $1,750.00. Check your policy for the amount of the benefit provided by your policy.

The above is a summary of benefits paid without regard to fault. No-fault benefits are intended to compensate for economic losses you may experience as a result of the accident. If you suffer serious personal injuries, you may also have a liability claim against a party at fault for the accident. This type of claim would be to seek compensation for your non‑economic losses, such as compensation for impairments, disabilities and/or pain that may result from the accident. Economic losses not paid as part of the no-fault benefits can also be recovered in this type of claim against a party at fault. Liability claims against third parties are claims based on fault unlike claims for no-fault benefits, such as medical expenses and wage loss. In fault claims, you must prove negligence on the part of the party you claim to be at fault. Generally, in a case of this type, it is necessary to show a serious injury that will fit into one of three (3) categories. These categories are: 1) death; 2) serious impairment of body function; or 3) permanent serious disfigurement.

Negligence claims against third parties are complicated and you should consult an attorney to determine if you have a claim that can be sustained under Michigan law.

There are time limits that apply to both no-fault and fault claims. You therefore should act promptly after an accident to preserve your legal rights.

© 2014 Schroeder DeGraw PLLC