*MI Auto Insurance changing???
Updated: Aug 3, 2020
The quick answer is YES!!! Here I go to explain, as I understand it, the very long more detailed version...LOL!
New Auto legislation passed and will take effect on July 2, 2020. What is changing?? The PIP (Personal Injury Protection) portion of the coverage will go through many changes. To understand the changes, first let's figure out what coverages are covered under PIP.
Medical/Allowable Expenses - consists of loss of income from work for individuals, who are injured in an automobile accident. Limitations apply to this benefit.
Wage Loss - consists of loss of income from work for individuals, who are injured in an automobile accident. Limitations apply to this benefit.
Essential Services - consists of reimbursement to individuals, who are injured in an automobile accident, for routine household services they would have done had they not been injured. Limitations apply to this benefit.
Funeral and burial expenses - limitations apply.
Survivor's loss - consists of benefits paid to survivors and dependents of an individual who dies as a result of an automobile accident. Limitations apply to this benefit.
So here comes the CHANGES Part! For policies issued or renewed beginning on July 2, 2020, Michigan drivers will be able to select their preferred level of Medical/Allowable Expense coverage under PIP. Based on an individual's eligibility and specific needs, the individual will be able to select from the following options:
A. OPTIONS AVAILABLE TO EVERYONE:
Unlimited which is what MI has had for the past many years with Michigan Catastrophic Claims Association involvement which accesses a fee of approximately $240 a year on each vehicle. (Fee varies by company you are insured with.)
2. $500,000 limit
3. $250,000 limit
B. OPTIONS AVAILABLE TO ELIGIBLE INDIVIDUALS WITH QUALIFIED HEALTH COVERAGE (QHC is Health insurance or accident insurance coverage that does not limit or exclude coverage for injuries related to auto accidents and has a deductible of $6,000 or less per person)
1. $250,000 PIP Exclusion
WHAT IS IT? If an individual qualifies for and chooses this option, and they are insured in in an automobile accident, their medical benefits will Be covered by their QHC providers. Individuals who purchase this option will not be eligible for any PIP medical/allowable expenses.
WHO IS ELIGIBLE? Insureds who have QHC and their spouse and/or resident relative(s)in the same household, who have QHC or are enrolled in Medicare Parts A and B. If not all household residents are eligible, it is still possible to select this option, with the exclusion applying only to eligible individuals.
C. OPTIONS AVAILABLE TO ELIGIBLE INDIVIDUALS WITH MEDICARE
1. Medical/allowable Expense Opt-Out-Medicare Only
WHAT IS IT? Complete opt-out of Medical/Allowable Expense coverage for Medicare recipients.
WHO IS ELIGIBLE? Insureds who are enrolled in Medicare Parts A and B. However a spouse and any resident relatives(s) in the same household must be enrolled in Medicare Parts A and B, have other Pip Medical/allowable Expense coverage, or have QHC. Insureds will be required to provide documentation showing that they, their spouse, and any resident relative(s) are eligible in order to elect this option.
D. OPTION AVAILABLE TO ELIGIBLE INDIVIDUALS WITH MEDICAID
1. $50,000 Medical/Allowable expense-Medicaid Only
WHAT IS IT? $50,000 Medical/Allowable Expense coverage option for Medicaid recipients.
WHO IS ELIGIBLE? Insureds who are enrolled in Medicaid. However, a spouse and/or resident relative(s) in the same household must also be enrolled in Medicaid, be enrolled in Medicare Parts A nd B, have other PIP allowable Expense coverage, or have QHC.
So these are the changes as I currently understand them but they may change. So far most companies have not sent out the new rates since some clarification of the laws have been changing. It currently looks like insureds may have to re-select their coverages and have to sign forms for that coverage at every renewal. We hope to see rates go down but, as of today when I am writing this, the new rates have not been sent to our Agency. Hope this helped clarify some of the changes! Welcome to the new MI No-fault please call us if you need help or have any questions. We LOVE to help!
*DISCLAIMER: Please see the No-fault Act for complete details. This summary is being provided for general information purposes only. Subject to regulatory approval. Coverage is subject to all policy terms, conditions, exclusions and limitations.
**Credit to Fremont Insurance for some of this content.**