Michigan Car Insurance

Michigan is still a no-fault state, but the framing many consumers remember is out of date. Public Acts 21 and 22 of 2019, effective July 1, 2020, replaced the old unlimited-PIP-only model with six PIP medical coverage tiers, raised residual bodily-injury liability defaults, and doubled (from $1,000 to $3,000) the mini-tort ceiling¹²⁶. The DIFS-prescribed PIP selection form documents which tier a household elects, and the choice drives both premium and post-crash medical exposure. This page owns the current Michigan rule; the consumer journey (accident, DUI, lapse, move) lives on our situation guides.

The no-fault system after the 2019 reforms

The Michigan No-Fault Act, adopted in 1972, was substantially amended by Public Acts 21 and 22 of 2019 and took its current shape on July 1, 2020¹. The reforms did not eliminate no-fault; they restructured what a no-fault policy must include and how much PIP medical coverage a household can elect. Three structural changes matter most for consumers:

• PIP medical becomes a choice. Before the reforms, Michigan drivers were required to carry unlimited lifetime PIP medical benefits. On or after July 1, 2020, drivers select from six DIFS-defined tiers ranging from unlimited down to a PIP medical opt-out for eligible Medicare enrollees².
• Residual BI liability defaults change. MCL 500.3009(1) raised the post-reform default residual bodily-injury liability limits to $250,000 per person / $500,000 per accident. Insureds may still elect down to $50,000 / $100,000 under subsection (5)⁴.
• Mini-tort ceiling rises. MCL 500.3135 increased the maximum mini-tort recovery from $1,000 to $3,000 for accidents on or after July 1, 2020⁶.

General PIP mechanics live on our medical payments coverage explainer (which references Michigan among no-fault jurisdictions); this page owns only the Michigan-specific rules.

The six PIP medical tiers and who may elect each

DIFS publishes the six PIP medical coverage tiers available to Michigan drivers after the reforms². Election is documented on a DIFS-prescribed selection form; eligibility conditions attach to the lower tiers and to the opt-out³.

1. Unlimited PIP medical coverage. Highest tier. Preserves the pre-reform framing for households that want it. Highest premium.
2. Up to $500,000 in PIP medical coverage. First tier below unlimited.
3. Up to $250,000 in PIP medical coverage. Second tier below unlimited.
4. Up to $250,000 with PIP medical exclusion(s). Available where the named insured or specific household members carry qualified non-Medicare health coverage that covers auto-accident injuries. The excluded person's auto-accident medical bills route through the health plan instead of PIP.
5. Up to $50,000 in PIP medical coverage. Available where the named insured is enrolled in Medicaid and every household member has other auto insurance, Medicaid, or health insurance that will cover auto-accident injuries.
6. PIP medical opt-out. Available where the named insured has both Medicare Part A and Medicare Part B and every household member has other auto insurance, Medicaid, or health insurance that covers auto- accident injuries. Election of the opt-out means no PIP medical benefits are paid to that named insured under the policy.

Residual bodily-injury and property-damage liability

Under MCL 500.3009(1), post-reform default residual liability limits are $250,000 per person and $500,000 per accident for bodily injury⁴. Subsection (5) allows the named insured to elect lower limits, but not lower than $50,000 / $100,000.

• Default is 250/500, not the minimum. A Michigan policy carries 250/500 residual BI unless the insured affirmatively elects the buy-down. Because of the mismatch between the default and the floor, always confirm which limit is being quoted rather than assuming.
• Residual liability responds to lawsuits. Michigan no-fault caps most tort claims for bodily injury from an ordinary accident through PIP first-party recovery, but the residual BI coverage responds to specific tort exposures the No- Fault Act permits.
• Property damage residual liability is also governed by MCL 500.3009 and applies to certain at-fault damage exposures. Personal limit decisions belong on our coverage-limits guide, not on this page.

Property Protection Insurance (PPI): $1,000,000 compulsory

Michigan requires Property Protection Insurance (PPI) on every no-fault policy under MCL 500.3121, at a $1,000,000 per-accident cap⁵. PPI pays for accidental damage your vehicle causes to tangible property such as buildings, fences, mailboxes, street signs, and properly parked cars, regardless of fault. PPI is not a substitute for residual property-damage liability, and it does not pay for damage to your own vehicle.

Mini-tort under MCL 500.3135

Michigan's mini-tort (formally, the limited property-damage liability) is a narrow tort remedy an injured driver can bring against an at-fault driver for vehicle damage not paid by the injured driver's own insurance⁶. Key rules under MCL 500.3135:

• Cap. Up to $3,000 in vehicle damage recovery for accidents on or after July 1, 2020. The prior $1,000 cap applies to earlier accidents.
• Fault threshold. The plaintiff must be 50% or less at fault for the accident.
• Scope. Covers only vehicle damage the injured driver's own insurance did not pay, typically the collision deductible or an uninsured collision loss. Does not cover medical bills, rental cars, or personal property.
• Time limit. A three-year statute of limitations under Michigan law generally applies to mini-tort actions. Verify the specific fact pattern with a licensed Michigan attorney.

PIP order of priority under MCL 500.3114

When an injured person is entitled to PIP benefits in Michigan, MCL 500.3114 sets the statutory order in which those benefits are paid⁷:

1. The injured person's own no-fault insurer pays first.
2. If none, a resident-relative's insurer in the same household.
3. If none, the Michigan Assigned Claims Plan (MACP) serves as the payer of last resort for eligible claimants.

This is why Michigan is often the clearest statutory example of "PIP follows the injured person" rather than following the vehicle. The follow-car question and full priority chain are covered on our does insurance follow the car or driver page.

Rating-factor restrictions after the reforms

DIFS Bulletin 2019-11-INS addressed prohibited and restricted rating factors for Michigan personal-auto insurance in connection with the 2019 reforms⁸. Michigan's framework restricts the use of certain non-driving factors in personal-auto rating but is not a full-prohibition regime like California's.

Because the specific restricted-factor picture is regulated through DIFS bulletins and can evolve, this page does not publish a comprehensive list; personal rating-factor framing lives on our how insurers calculate rates guide.

Proof of insurance, registration, and lapse consequences

Michigan requires proof of no-fault insurance to register a vehicle and at traffic stops. The Michigan Secretary of State manages vehicle registration and uses insurer reporting to verify coverage¹⁰. Driving an uninsured vehicle carries statutory penalties including fines and possible license or registration consequences. Reentry mechanics after a lapse (reinstatement, insurer underwriting treatment, and how a lapse can affect the next policy) live on our after-a-lapse guide. This State Guide states only the Michigan-specific rule.

Where the Michigan situation rules live on YesWeSure

• After an accident. General after-accident premium framing and the three-clocks model live on our after-an-accident guide.
• After a DUI. DUI-specific insurance consequences live on our after-a-DUI guide. This State Guide does not publish a Michigan- specific SR-22 duration; verify with Michigan SOS.
• After a lapse. Reentry, reinstatement, and how a lapse can affect underwriting live on our after-a-lapse guide.
• Moving into Michigan. Registration and proof-of-insurance timing for new residents live on our moving-to-another-state guide. This State Guide does not publish a specific new- resident deadline in days; verify with Michigan SOS.
• Filing a claim. Generic claims workflow lives on our how to file a claim guide.

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