If you are involved in a car accident in Michigan, one of the first things you will likely deal with is Personal Injury Protection (PIP), which is a central part of the state’s no-fault auto insurance system. PIP coverage plays a big role in how your medical bills and other costs are handled after a crash. Here is what you need to know about PIP.
What Is PIP?
Michigan is a no-fault state, which means your car insurance pays for certain accident-related expenses, regardless of who was at fault. This includes coverage for medical bills, lost wages, and replacement services if you are injured in an auto accident. It applies whether you were driving, riding as a passenger, walking, or biking. PIP is your safety net after an accident.
What Does PIP Cover?
A standard PIP policy typically includes:
- Medical Expenses: Coverage for hospital stays, doctor visits, surgery, physical therapy, medications, and other necessary treatments.
- Lost Wages: Up to 85% of your income for up to three years if you cannot work due to your injuries.
- Replacement Services: Up to $20 per day for services, such as housekeeping or childcare, if your injuries prevent you from performing daily tasks.
- Funeral & Survivor Benefits: If an accident results in a fatality, PIP may pay for funeral costs and provide financial support to dependents.
Who Pays First?
If you were injured in a crash, your own auto insurance will typically pay your PIP benefits, even if the accident was not your fault or if you were a passenger. If you do not have your own policy, you may be covered by a family member’s insurance or, if no coverage is available, by the Michigan Assigned Claims Plan, which provides limited benefits in certain cases.
What Happens If Your Bills Go Over Your PIP Coverage?
If your medical costs exceed your PIP limit, you may need to rely on:
- Health insurance
- Out-of-pocket payments
- A lawsuit against the at-fault driver for additional damages like excess medical bills, long-term lost wages, and pain and suffering
To sue for these damages, your injuries must meet Michigan’s legal standard of a “serious impairment of body function.” This refers to significant injuries that affect your ability to live a normal life, including broken bones, herniated discs, traumatic brain injuries, or permanent scarring and disfigurement.
Final Thoughts
Personal Injury Protection is one of the most important aspects of auto insurance in Michigan. With the ability to choose your level of coverage, it is important to understand what you are buying and what it may mean for your health and finances if you are ever in a crash.