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What to Know
The no-fault reform applies to every Michigan driver with a policy issued or renewed after July 1, 2020. PIP is the part of a Michigan auto policy that pays your medical bills, lost wages, and some care costs after a crash, no matter who caused it. Before the reform, every policy had to include unlimited PIP medical coverage. Now you choose a limit.
Your current selection is listed on your declarations page, the summary page at the front of your policy. Check it before you change anything.
Your PIP Coverage Options Under the New Michigan Auto Insurance Laws
Michigan offers up to six PIP medical choices: unlimited, $500,000, $250,000, $250,000 with some household members excluded, $50,000 for Medicaid enrollees, and a full opt-out for people with Medicare Parts A and B. Anyone can choose the first three. The last three depend on health coverage you already have.
The table below shows who can choose each option and who pays if your medical bills go past the limit.
| PIP option | Who can choose it | What pays if your bills exceed it | Who it suits |
|---|---|---|---|
| Unlimited | Any driver | No lifetime cap on allowable crash-related medical costs | Households with no health coverage that pays for auto injuries |
| $500,000 | Any driver | Your health plan, then a possible claim against the at-fault driver | Drivers with a health plan who want room for long-term care |
| $250,000 | Any driver | Your health plan, then a possible claim against the at-fault driver | Drivers with strong health coverage and a tighter budget |
| $250,000 with exclusions | Policyholders whose excluded household members have qualified health coverage or other PIP | Each excluded person's own health plan, from the first dollar | Households where a spouse or relative has employer coverage or Medicare |
| $50,000 | Policyholders enrolled in Medicaid; household members need qualifying coverage | Medicaid | Medicaid enrollees only |
| Opt-out | Policyholders with Medicare Parts A and B; household members need qualifying coverage | Medicare | Medicare enrollees whose whole household is covered elsewhere |
The bottom two rows depend on your eligibility. You can't choose them unless you're already enrolled in Medicaid or Medicare.
Most drivers still choose unlimited, but that is changing. By 2024, 28.8% of insured vehicles had a limited PIP medical benefit or had opted out, up from 17.6% in 2021, according to a study. Among the limited options, the $250,000 tier appears to have grown the fastest.
What counts as qualified health coverage
Qualified health coverage is a health plan that doesn't exclude or limit auto accident injuries and has a low individual deductible, or Medicare Parts A and B.
Two common health plans can fail this test.
- Some employer plans, often self-funded ones, exclude auto injuries or pay them only after auto coverage runs out.
- High-deductible plans can go over the limit required to qualify. A family plan can look affordable, but the per-person deductible may be too high to qualify.
Your insurer must ask for proof before selling you a limited or excluded option. The Michigan Department of Insurance and Financial Services (DIFS) posts current forms and requirements at michigan.gov/autoinsurance.
Liability coverage follows separate rules. Bodily injury liability now defaults to a much higher limit than before, unless you sign a form choosing a lower limit. The lowest limit you can choose is 50/100.
How to Choose a Michigan PIP Level for Your Household
- Start with your declarations page. Find your current PIP medical limit and whether anyone in your household is excluded.
- Call your health plan with two questions: does it pay for car accident injuries, and what is the individual deductible? You can also find the answers in the coordination-of-benefits section of your plan documents.
- Count everyone the policy covers. PIP covers your spouse and relatives who live with you. A teen driver or a parent on a different plan can change which options you qualify for.
- Then answer the harder question: if your bills went past the PIP limit, who would pay for long-term care? That includes rehab, home modifications, and attendant care, which is help with daily tasks during recovery. Health plans and Medicare often limit or exclude these costs, while PIP generally covers them up to your limit.
- Price the same policy at two tiers with the same insurer and the same deductibles. Look at the dollar difference, not the percentage.
Here's a hypothetical example to show the math. A household is quoted $1,800 a year with unlimited PIP and $1,560 with $250,000 in PIP. The difference is $240 a year, or $20 a month.
After a serious crash with $400,000 in medical costs, $150,000 would be left beyond the limit. If the household has qualified health coverage, most of the hospital and doctor portion of that $150,000 goes to the health plan. The remaining risk is mainly long-term care that the health plan won't pay for, plus whatever you might recover from the at-fault driver.
Some things you can't change: Medicare and Medicaid eligibility, and your health plan's terms. You can change your tier and the insurer you buy it from.
What the Michigan Car Insurance Reform Changed Beyond PIP
The 2019 Michigan car insurance reform also capped what medical providers can charge auto insurers, limited paid family caregiving hours, raised the mini-tort limit, and banned some non-driving rating factors. Most of these rules matter only after a crash, but they affect what each PIP tier pays for.
The table below compares the rules before and after July 2020.
| Rule | Before reform | After reform | What it means for you |
|---|---|---|---|
| Medical provider charges | No set limit on what providers billed auto insurers | Capped at a percentage of Medicare rates, set by provider type | Your PIP limit goes further, but some providers limit auto-injury patients |
| Family attendant care | No weekly hour cap | 56 paid hours a week for family or household caregivers | Optional extra coverage pays for more hours |
| Mini-tort limit | $1,000 | $3,000 | You can recover up to $3,000 in vehicle damage if the other driver is more than 50% at fault |
| Default bodily injury liability | 20/40 minimum | 250/500 default; 50/100 with a signed form | You need to choose lower limits on purpose |
| Non-driving rating factors | Allowed | Banned, including sex, marital status, homeownership, education and occupation | Your rate depends more on how you drive |
The attendant-care cap is the rule most likely to affect families. Suppose a spouse provides 12 hours of care a day. That's 84 hours a week, and only 56 are paid.
Mini-tort is the right to claim vehicle damage from the at-fault driver. It can often cover your collision deductible.
The Michigan Supreme Court's 2023 Andary decision found that the fee schedule and attendant-care limits don't apply to people injured before June 11, 2019. If that describes someone in your family, talk to a Michigan attorney.
Did No-Fault Reform Lower Michigan Auto Insurance Rates?
Yes, compared with where costs were heading. That doesn't mean your own bill went down. Treating the official savings figure as a promise can lead drivers to stop comparing prices.
The state's study estimates the reform cut premiums by $357 per insured vehicle, or 18.8%, from 2019 to 2024. That number compares actual premiums with a model of what premiums would have been without the reform. It doesn't compare your old bill with your new one.
Most of the estimated savings came from PIP, which fell $369 per vehicle (44.7%), while liability premiums rose $21 (6.5%). Wayne County had the largest estimated PIP reduction, at $539 per vehicle, or 47.5%.
The study also found that uninsured driving increased. Michigan's uninsured rate was 18.8% in 2024, up from 17.2% in 2019, though the state's gap above the national rate narrowed from about 5.4 points to 3.9. If you lower your PIP limit to save money, keep your uninsured motorist coverage.
For your next renewal, the money is in how much insurers' prices differ for the same tier. Insurers' prices can vary within the same PIP tier, so comparing quotes at your chosen tier matters more than the tier itself.
Choose your tier based on your health coverage first. Then compare quotes at that tier with matching limits and deductibles.
Frequently Asked Questions
What are Michigan car insurance requirements now?
Michigan drivers need personal injury protection (PIP) at a level they choose, property protection insurance for damage their car causes to other people's property in Michigan, and residual bodily injury liability. Liability defaults to a higher standard limit unless you sign a form choosing a lower limit, with a minimum floor you can select.
Can I opt out of PIP medical coverage in Michigan?
Only if you have Medicare Parts A and B, and your spouse and any resident relatives either have their own qualifying health coverage or their own PIP. Your insurer will ask for proof before approving the opt-out.
What happens if my medical bills exceed my PIP limit?
Your health insurance may cover some of what's left, depending on its own deductibles and exclusions for auto-related injuries. You may also be able to sue the at-fault driver to recover medical expenses beyond your PIP limit, which is part of why your liability limit matters alongside your PIP choice. A Michigan attorney can walk through your specific numbers.
Does Michigan's no-fault reform apply to people injured before 2019?
No. Under the Michigan Supreme Court's 2023 ruling in Andary v. USAA, the medical fee schedule and the 56-hour weekly cap on family-provided attendant care don't apply to people injured before June 11, 2019.
Are more Michigan car insurance changes coming?
The Michigan Department of Insurance and Financial Services (DIFS) presented its reform-impact study to a state House committee in January 2026, and lawmakers continue to review how the 2019 law is performing. Check michigan.gov/autoinsurance directly for the current status before assuming a rule has changed.
