Michigan Auto Reform: Key For Decisions Consumers
DECISION #1: KEEP UNLIMITED PIP OR LOWER YOUR COVERAGE
Depending on your health insurance, you may be able to choose from a variety of PIP coverage levels to save money.
Key Decision Point: You will likely save some money no matter what. If you are in an accident and do not have unlimited PIP coverage, you could face medical and other bills you cannot afford to pay. Is the additional savings (roughly a couple hundred dollars per year per vehicle) worth the risk?
DECISION #2: SELECT THIRD-PARTY LIABILITY COVERAGE LIMITS
The minimum amount of third-party liability coverage—which helps pay for damages awarded in a lawsuit by a third- party if you are legally at fault for an accident—has also increased. If you carried less than $250,000 per person / $500,000 per accident in your old insurance, you would default to this level; however, you can choose lower limits by signing a form if you want less coverage.
Key Decision Point: With some drivers carrying less PIP coverage for themselves, lawsuits to recover damages above the injured person’s PIP limits could be more common, and if you are at fault, you could be responsible to pay substantial damages out of pocket.
DECISION #3: WHEN TO UPDATE YOUR POLICY
The law changes effective July 2, 2020. You can choose to wait until your regular auto insurance renewal date, and your carrier will likely contact you with forms to make your decisions. If you want to take advantage of lower prices as soon as they are available, call us at 734.422.7850. While every insurance carrier has different procedures (and some may not be ready to process changes yet), we can help you make your selections with your carrier so you can save money faster! If you want to shop around for the lowest rates, we can help with that too!!
Key Decision Point: Do you want to begin saving money now or wait to see your savings later?
BONUS CONSIDERATION: MAKE SURE YOU ARE APPROPRIATELY INSURED
The law also changed the definition of covered persons leaving a gap in coverage for many consumers. If you have children who live away from year-round, or you live with friends or a significant other, you will now likely need separate insurance policies.
Please note this article is for informational purposes only, is general in nature, and is not intended to and should not be relied upon or construed as a legal opinion or legal advise regarding any specific issue or factual circumstance.