Secrets About No-Fault Insurance: Medical Expenses, Uninsured Motorists, Lost Wages And Your Rights

Anyone who is a Michigan resident and is injured in an accident involving a motor vehicle has two claims they may be able to pursue.

All Michigan residents injured in a motor vehicle accident have the right to receive no-fault benefits (with one exception), even if the accident occurred out of state.

No-fault benefits are insurance benefits that are paid to a Michigan resident who is injured in a motor vehicle accident. There are three benefits, medical, wage loss and replacement services. You obtain these benefits by filing a claim with the proper motor vehicle insurance company. You must file this claim within a year of the accident date or you lose the right to receive no-fault benefits.

I often get calls from injured people stating they were told the person who caused the accident’s insurance company doesn’t have to pay any of these benefits, why not?

In Michigan we have a priority system as part of the no-fault law that mandates whenever you are hurt in an accident involving a motor vehicle you look to yourself first for coverage. If you owned a motor vehicle that was insured on the date of the accident, it pays your no-fault benefits, even if you were injured while walking, riding a bike or in someone else’s vehicle when the accident occurred. If you didn’t own a vehicle that was insured on the date of the accident you go to the next level of priority. Did you live with a relative that owned a car that was insured on the accident date? If you answer “yes” that insurance company pays the benefits. If, “no” you move to the next level, the owner or operator of the vehicle you were in when the accident occurred. The good news is, in Michigan, no-fault benefits are mandatory and are guaranteed. Every injured person is entitled to benefits (with one exception), it is just a matter of figuring out which company will pay them. If all else fails, your claim is assigned to the Michigan Assigned Claims facility for payment of benefits.

Under Michigan law, you are entitled to have your medical bills relating to treatment for injuries suffered in motor vehicle accidents paid by a motor vehicle insurance carrier. The treatment received must be for the injuries suffered in the accident and the services must be reasonable and necessary to treat the injury. Medical benefits are life-time benefits. You are still entitled to benefits even if you no longer have insurance with that motor vehicle insurance carrier after the accident. You may have paid a lower premium and elected to have your medical benefits coordinated. This means for paying a lower premium, you agreed to submit your bills to the appropriate health insurance carrier and whatever is not paid by it will be paid by the motor vehicle insurance company. This area of the law is very complicated and I suggest you talk to an attorney to be fully informed of the law and your rights in this area. Medical benefits include round-trip mileage driven for any treatment or medical purpose relating to the accident. It also includes rehabilitation, accommodation and may include vocational training that may be required to assist the injured person.

You are entitled to 85% of your gross taxable wages for wages lost due to injuries suffered in an accident. The inability to work must be due to the injury. Wage loss benefits are not life-time benefits. It ends three years from the date the accident even if the injured person is permanently or totally disabled. You may be entitled to wage loss benefits even if you were unemployed on the date of the accident if you can establish you were temporarily unemployed. You may also be entitled to additional wages for any raise you would have received or a promotion you lost while you were off due to your injury. There is a ceiling on wage loss benefits and the insurance carrier is entitled to set off some wage loss benefits received from other sources. If your disability goes beyond three years or your loss exceeds the ceiling you may be entitled to be compensated for this “excess wage loss” from the party responsible for causing your injury. This is referred to as a third party claim and is discussed elsewhere. Wage loss benefits and other economic benefits are also available to dependents of persons killed in accidents involving motor vehicles.

Replacement services are the household chores that you normally do but are unable to do due to the injury you received. You are entitled to be reimbursed for these services up to a maximum of twenty dollars a day. A family member can perform the services and you do not have to pay the family member to be entitled to be reimbursed for the services. Nursing care is not a replacement service and is not limited to the twenty dollar a day limitation. It is a medical benefit that sometimes may be performed by a household member. This service is reimbursed at an hourly rate and is unrestricted and a potential lifetime benefit.

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What your insurance company isn’t telling you