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Car Insurance Requirements in Michigan

Car insurance requirements in Michigan are the mandatory elements of car insurance coverage that every driver must carry in order to satisfy the demands of MI state auto insurance law, and are important things to consider as part of car insurance options for parents. Michigan is a no fault state with some unique provisions that its drivers must abide by. As auto owners in the state, we need to be aware of all of these provisions and find an affordable and reliable online car insurance rate in the state to contract with for a compliant and protective auto insurance policy.

No Fault Insurance in Michigan

The state of Michigan has the most comprehensive no fault car insurance system in the entire country. One of the unique components that set this system apart from others of its kind is the fact that it contains provision for unlimited benefits for medical and rehabilitation expenses and most wages benefits for holders of Michigan auto insurance. Drivers also get protection against lost wages and twenty dollars per day replacement services for up to three years for anyone who is injured in an accident, regardless of fault in the crash [1]. This is where the term "no fault" comes from. It does not mean that Michigan insurance companies or legal authorities have no interest in finding fault for accidents; but that accident victims are guaranteed coverage for their injuries regardless of fault.

Every vehicle registered in the state of Michigan must be insured according to the guidelines set forth in state auto insurance law. If you own a vehicle and drive it on state roads, or even if you allow someone to borrow a car and it does not have compliant no fault insurance, you can be sued and held personally responsible for any financial damages that could result from accidents or other claims. Additionally, noncompliant auto owners face possible fines and/or jail time [1].

Required Michigan Car Insurance

Every no fault policy sold and administered in the state of Michigan must have three parts: personal injury protection (PIP), property protection (PPI), and residual bodily injury and property damage liability insurance (BI/PD). PIP pays any necessary and reasonable medical costs if you get injured in an auto accident. Property protection covers up to $1 million in damage your car does to other people's property, including things such as building structures, signs, and fences. And residual bodily injury and property damage liability takes care of your legal defense expenses and any financial damages you are forced to any in a judgment following an auto accident, up to the policy's maximum financial limits [1].

The minimum limits for Michigan drivers for their BI/PD coverage are $20,000 for a single victim injured or killed in a collision, $40,000 for multiple victims hurt or killed, and $10,000 for any property damage you cause in an accident outside of Michigan [1]. Beyond these minimums all motorists are able to purchase additional coverage to increase the limits and protection of their policies; it is up to the individual driver to decide how much to include in their plans and to make coverage choices based on their needs, preferences, and budget.

Optional MI Car Insurance Coverage

On top of the required coverage included under Michigan no fault auto insurance law, drivers in the state also have some options on extra areas of coverage they could include in their car insurance policies if they so desire. These additional areas of coverage are not required by the state, but they are often selected by drivers as a way of strengthening their policies and giving them more protection for their families and property. Some of the more common optional areas of coverage are comprehensive and collision, uninsured motorist coverage, and mini tort insurance.

Collision and comprehensive protect the covered vehicle from property damage stemming from any covered cause. Collision insurance covers damage from car accidents, with the exception of deer hits, tree hits, and other so called "acts of God" that fall under the comprehensive portion of an auto insurance policy. As its name suggests, comprehensive covers everything other than collision. There are important limitations and exclusions to these plans that drivers should be aware of; check your policy for details.

Uninsured motorist insurance provides coverage for accidents with uninsured drivers. It replaces the coverage that the liable driver's liability policy would ordinarily take care of.

Mini tort insurance, also known as limited property damage liability insurance, basically covers the collision deductible the other driver has to pay if you are at fault in an accident, up to a limit of $500 [1].

Drivers in the state of Michigan can save money on their no fault car insurance by getting online and requesting multiple quotes for their coverage. Get quotes from local insurance providers using our free quote tool and save money on car insurance requirements in Michigan.

[1] http://www.michigan.gov/dleg/0,1607,7-154-10555_13222_13224-66774--,00.html Retrieved 2010-08-13.

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