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When is a policyholder entitled to PIP coverage in Michigan? P.1

No-fault insurance, also known as personal injury protection (PIP), is an important source of compensation for those injured in an automobile accident, but it is important for insurance companies to ensure they are not paying claimants who are not entitled to coverage. This is particularly important because of the extent of no-fault coverage.

Michigan no-fault policies provide unlimited medical and rehabilitation benefits, as well as wage loss benefits for up to three years, and $20 per day for replacement services. No-fault insurance in Michigan also covers damages to vehicles and some liability. Broken down, a basic no-fault policy includes several parts: personal injury protection, property protection, and residual bodily injury and property damages liability insurance. Exactly when a policyholder is entitled to personal injury protection benefits, though, is not always a straightforward matter. 

There are a number of requirements under state statute regarding when entitlement to personal injury benefits. First of all, the vehicle with which the accident occurs must have been a motor vehicle, and this excludes motorcycles, mopeds, farm tractors, golf carts, and certain other types of vehicles. The term motor vehicle includes trailers.

State law also provides that insurance companies are required to pay benefits for accidental bodily injuries. Whether or not a crash is accidental involves careful examination of the facts. Cases where the crash is intentional do not qualify for coverage. As far as whether there bodily injury has occurred, it is expected that medical evidence will be provided to support this.

Another requirement is that the bodily injury must arise out of the ownership, operation maintenance or use of a motor vehicle as a motor vehicle. The “arising out of” requirement can be important in cases where injuries occur in connection with a parked vehicle. In our next post, we’ll look at this issue further.


Michigan Department of Insurance and Financial Services, No-Fault Automobile Insurance in Michigan.



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