How the New Michigan Car Insurance Law Affects Commercial Vehicles

Michigan’s mandatory no-fault automobile insurance system was replaced when the state implemented new regulations in July 2020. Under the new law, drivers now have a choice when selecting Personal Injury Protection (PIP) — or no-fault insurance. This effectively enables Michigan drivers to decide whether an automobile or medical insurance provider would serve as the primary coverage in the event of an accident. The law was changed in response to Michigan’s insurance rates, which were amongst some of the highest in the country, by offering more medical coverage options.

Given the new changes, the secondary form of coverage would take over when the primary coverage runs out, after covering common expenses such as medical bills, treatment, rehabilitations, or funerals. While there are complexities in understanding your rights and responsibilities associated with these changes, Doeren Mayhew Insurance Group provides the guidance you need. Whether you have cars, taxis, or trucks, or an entire vehicle fleet, we offer guidance on a wide range of commercial vehicle insurance policies.

New Coverage Limits

Personal Injury Protection

Since Michigan’s no-fault car insurance law changed, commercial vehicle owners can opt into a different level of PIP which changes the limits of coverage. Historically, PIP covers medical costs associated with auto accidents that may include surgical treatments, dental treatments, medication, and prosthetic devices. Additional covered expenses may also include lost income, child care expenses, and household services.

Bodily Injury Liability

Furthermore, business owners will now have the option to select a new Bodily Injury Liability Limit for their commercial auto policies. This is another feature of the former no-fault law that covers the costs of financial damages if a business owner or employee is to blame for causing bodily injury while operating a covered vehicle.

According to the new law, coverage defaults to $250,000/person and $500,000/accident — if your existing limit is lower. However, most commercial automobile insurance policies typically carry a minimum of $1,000,000 in bodily injury liability and/or umbrella insurance policies.

Mini Torts

The mini tort claims (limited property damage) limit also changed from $1,000 to $3,000, which enables an insured entity to collect money for uncovered physical vehicle damage from the driver that caused the damage. Uninsured drivers are not eligible to claim any sort of financial compensation under Michigan’s mini tort law.

What You Should Do

As a commercial vehicle owner, it’s important to talk to a trusted auto insurance agent to review your auto insurance policy under the parameters of the new law. Contact one of our knowledgeable insurance advisors to learn more about how the new Michigan car insurance law affects commercial vehicles, or request a quote online to ensure your business has proper coverage.