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No-Fault Explained: Out-of-State Insurer

Most car crashes that happen in Michigan involve Michigan residents with Michigan no-fault insurance. But not all of them. If your collision involved an out-of-state insurer, are you covered?

MCL 500.3163 explains when and how an out-of-state insurer will be required to pay no-fault PIP benefits. Deciding whether those benefits are covered, and for how much involves a number of questions.

Does the Insurance Company Do Business in Michigan?

If the out-of-state insurer is authorized to sell auto insurance in Michigan, it is required to certify that any accidents happening in this state will be covered according to the Michigan No-Fault Act, even if they involve out-of-state residents or other states’ policies.

Did the Out-of-State Insurer File a Certification?

Even if the insurance company isn’t in business in Michigan, it may have voluntarily filed a certification to allow Michigan based coverage. This certification also allows the insurance company to be sued in a Michigan court. You can find out if your insurance company did that by checking out the No Fault Certification List available from the State of Michigan.

Is the Injured Person a Michigan Resident?

Remember that a person may be entitled to claim coverage by a policy he or she didn’t sign up for. If the injured person was a pedestrian, bicyclist, or passenger without Michigan No-Fault coverage of his or her own, then the claim could fall to the out-of-state insurer. If the injured person was a Michigan resident, he or she is entitled to full PIP benefits. If not, it depends on the vehicle being driven.

Was the Vehicle Registered in Michigan?

What car the non-resident was driving could make all the difference with an out-of-state insurer. Under Michigan law, if the car involved in the accident was registered in Michigan, normal Michigan law applies. For example: if Lucy, who lives in Ohio, is visiting Charlie in Michigan, and gets hurt while driving Charlie’s car, her out-of-state insurance will cover all of her medical expenses, wage losses, and attendant care costs, as though she had a Michigan no-fault policy.

But if a non-resident is injured while not driving a vehicle registered in Michigan, insurance payments are capped at $500,000 per claim. That includes out-of-state residents involved in pedestrian, bicycle, and motorcycle accidents. If there are any other sources of coverage for a person’s claims, those are excluded too.

So if Lucy, while visiting Charlie, drives her own, Ohio-registered car and gets into an accident, her recovery may be limited to $500,000. If her injuries go beyond that cap, she will need to file a Third Party lawsuit against the at-fault driver to get those extra damages covered.

The auto accident attorneys at Christensen Law understand all the ins and outs of the Michigan No-Fault Act. No matter where you are insured, if your accident happened in Michigan, they know how to get your costs covered. If you have been seriously injured in an auto accident, contact Christensen Law today to schedule a free consultation.