What Happens if You’re Hurt in an Accident as a Passenger?

With Michigan’s No-Fault Insurance, Do You have the Right to Sue?

At Mike Morse Law Firm, our personal injury attorneys have won over $1.5 billion for our clients. You’ll probably agree that’s not chump change. But, before we discuss whether your car accident injuries could result in a multi-million-dollar legal settlement of your own, let’s first discuss your car insurance. Recent changes to Michigan no-fault insurance policy coverage have made the information in this week’s blog vital to you and your family’s finances.

On July 1, 2020, Michigan revised its no-fault insurance laws to help reduce costs for drivers and insurers. If you have either purchased or renewed your car insurance policy since then, it falls under the state’s new cost-saving parameters. This may sound like good news at first, but you should know that reducing up-front insurance costs could result in dramatic problems down the road — for both drivers and passengers who are injured in car accidents.

That’s because the new rules drastically reduced the Personal Injury Protection (PIP) coverage included in Michigan no-fault insurance policies. According to an article in Forbes, “Michigan’s extraordinarily high average PIP claims at over $80,000” resulted from the state’s previous policy stating, “all drivers could receive unlimited lifetime medical benefits for car accident injuries.”

Not anymore. Starting last July, Michigan drivers had the option to cut their car insurance costs by agreeing to reduce the medical benefits covered by their no-fault insurance plans. In fact, depending on your personal circumstances, you can now save money on car insurance premiums by choosing PIP coverage with as low as $50,000 in maximum benefits.

But, with medical costs constantly rising, is this the best decision? Consider the case of accident victim Mark Gottlieb, whose story was profiled by NPR. Mr. Gottlieb was injured in an accident that wasn’t his fault, but his no-fault insurance coverage had limited PIP benefits — in his case, the seemingly substantial sum of $250,000. But when the hospital bills arrived, they totaled more than $700,000. While his insurance company paid $250,000 (and also negotiated on Mr. Gottlieb’s behalf to reduce his bills), he was still left with nearly $90,000 in personal medical debt. Could you cover that kind of unexpected cost? And what happens if you can’t? Imagine dealing with the agony of accident recovery and bill collectors at the same time!

Fortunately, Michigan law does let you seek other recourse through filing a lawsuit. And you can sue negligent drivers even if you’re a passenger. As attorneys, we know that regulations governing no-fault insurance are complicated, so we’ve partnered with Laura Hall, communications director of the Michigan Department of Insurance and Financial Services, to respond to your FAQs about these complex issues.

Q: If someone is a passenger in my car when I am involved in an accident, can they sue me or my insurer for no-fault benefits?

A:  A passenger who has their own PIP coverage would first access that coverage. Whether a passenger is covered by your PIP coverage depends on their relationship to you, what coverage they have, your specific policy language, and other factors. Questions regarding how passengers are covered under your policy should be directed to the insurance carrier, as they are specific to the language of the insurance policy contract. In addition, an in-state passenger who is otherwise uninsured would have $250,000 in PIP coverage from the Michigan Assigned Claims Plan.

Q: Is their (the passenger’s) recourse limited to the Personal Injury Protection of my no-fault policy?

A: If you are responsible for injuries to another person in a car crash, you may be liable for damages for their pain and suffering, as well as the costs of their medical and other care that exceed what is covered by applicable PIP coverage. Michigan law requires all drivers to have Residual Bodily Injury and Property Damage Liability (BI/PD) coverage, which will pay up to your coverage limit amounts if you are found legally responsible for damages in a crash. The current minimum coverage level is $50,000 for a person who is hurt or killed in an accident/$100,000 for each accident if several people are hurt or killed.”

We also impart a warning to Michigan drivers who have chosen limited liability coverage. The bodily injury liability limit of your policy will pay for such damages, but only up to the amount of the limit you choose; therefore, you will be required to pay any amount over the limit you choose. This amount could be substantial and lead to severe financial consequences.

Our Advice to Michigan Drivers: Choose Unlimited PIP Coverage …

In our opinion, if you’re concerned about paying high medical costs caused by an accident, you should choose a car insurance policy with unlimited PIP coverage. Yes, it will cost more. But do you really want to risk everything just to save a few dollars? Furthermore, Michigan’s PIP benefits also include helpful coverage you might not expect. For example, a fact sheet published by the Michigan DFIS says that, “a no-fault policy covers all family members living in your household. PIP benefits will be paid even when a family member is a passenger in another person’s car or is a pedestrian when an accident takes place. It will also cover a motorcyclist who is hurt in an accident involving your car up to the limit of coverage selected under your policy.”

In addition, PIP will pay you and other covered individuals up to three years of lost wages stemming from injuries caused by a car accident. Starting October 1, 2021, the maximum, 30-day work loss benefit is $6,065, according to Michigan regulations.

One more valuable PIP benefit is “attendant care” which covers costs for any daily assistance you may need resulting from injuries suffered in a car accident. When such care is provided by family members or friends, payment is limited to 56 hours per week. If, on the other hand, you hire a professional caregiver, PIP coverage for attendant care is unlimited.

… And Get an Auto Accident Advocate on Your Side

Let’s return to that dire warning mentioned earlier: “If you are responsible for injuries to another person in a car crash, you may be liable for damages for their pain and suffering, as well as the costs of their medical and other care that exceed what is covered by applicable PIP coverage.”

Determining the level of liability is where the auto accident attorneys at Mike Morse Law Firm come in, filing lawsuits on behalf of people whose medical bills (and pain and suffering) exceed the limits of no-fault insurance PIP coverage. As we previously noted, we’ve won more than $1.5 billion for clients whose pain and suffering simply can’t be quantified by any monetary amount. So, whether you’re a driver, a passenger, or a pedestrian injured by someone who was negligent on the road, contact us today. We’ll be at your side — and on your side — from the moment you ask for our help at 855-MIKE-WINS (855-645-3946).

Content checked by Mike Morse, personal injury attorney with Mike Morse Injury Law Firm. Mike Morse is the founder of Mike Morse Law Firm, the largest personal injury law firm in Michigan. Since being founded in 1995, Mike Morse Law Firm has grown to 150 employees, served 25,000 clients, and collected more than $1 billion for victims of auto, truck and motorcycle accidents. The main office is in Southfield, MI but you can also find us in Detroit, Sterling Heights and many other locations.