How To Deal With New Michigan Auto Insurance Law

DETROIT – Michigan’s new auto insurance law is one that many residents have been waiting for due to lower rates, but There are complex decisions drivers must make.

The lowest auto insurance rates arrive on Thursday (July 2).

Michigan Auto Insurance Changes: What you need to know

To reduce insurance changes in the simplest possible way, there are two options: the amount of personal injury protection one needs and can pay, and the amount of liability one needs and can pay.

Protection against personal injury

Option # 1 surrounds Personal Injury Protection (PIP), or Accident Injury Coverage. You will want to see if you have what is called “coordinated coverage.”

That is health insurance. The state calls it “qualified health coverage,” like Blue Cross Blue Shield or another provider that specifically tells you that it covers auto accidents and that you can choose not to participate in PIP.

RELATED: Michigan Drivers Face New Insurance Option Starting Thursday

It is vitally important to consult with your medical insurer and ensure that your coverage is good and that the deductible is $ 6,000 or less.

Otherwise, you can choose to keep unlimited coverage or reduce coverage and premiums to lesser amounts: $ 500,000, $ 250,000, or $ 50,000 if you have Medicaid.

Liability coverage

The second option surrounds liability coverage. An old law from the 1970s required $ 20,000 per person and $ 40,000 of coverage for all people.

As of Thursday (July 2), it goes to $ 50,000 per person and $ 100,000 for all individual injuries / accidents.

“If you don’t choose, you will get a predetermined level that is higher than $ 250,000 per person, $ 500,000 for any injured in an accident, which have the corresponding higher premiums if you don’t come back and change it,” said Anita Fox, director Michigan Insurance and Financial Services.

AAA’s Dan Shrock said none of this is simple, easy, or fast.

“It takes 45 minutes to an hour to educate a consumer and let them know their options and make an educated decision,” said Shrock.

The rush is for people whose policies are renewed this week. For everyone else, there is more time.

The best answer is to check with your agent, or call your auto insurer if you don’t have an agent, and start asking questions.