What Drivers
Should Know About
Michigan Auto Insurance Reform
What Drivers Should Know About Michigan Auto Insurance Reform

Here's the latest information on recent changes to Michigan's auto insurance laws from Meemic Insurance, a proud member of the AAA family.

Past: 1973

Michigan institutes no-fault auto insurance.

Prior to 1973, Michigan had a tort – or at-fault – auto insurance system under which the driver who caused an accident paid for damages. Because this was often determined in court, auto accident-related lawsuits flooded the Michigan court system, and insurance premiums skyrocketed. No-fault insurance was implemented in Michigan in 1973 to combat those rising costs, limiting lawsuits to cases of severe injury, disfigurement or death.


By 2018, Michigan auto insurance had become cost-prohibitive for many. Michigan is ranked fourth in the U.S. as the most expensive auto insurance.* Not surprisingly, it is also ranked fourth in the U.S. for the number of uninsured drivers, with an estimated 20.3% of its drivers having no insurance.**

Present: 2019

The Michigan Legislature votes to reform the no-fault system.

We have long supported reform that would make auto insurance in Michigan more affordable. In May 2019, many changes, including fee schedules for medical services and the creation of an anti-fraud unit, were passed into law, with certain sections of the law effective on different dates, by the Michigan Legislature.

Future: 2020

Auto insurance reform goes into effect July 2020 with regard to the selection of PIP options.

Beginning in July 2020, Michigan drivers will be able to select their preferred level of Personal Protection Insurance – commonly known as Personal Injury Protection, or PIP – that pays for medical coverage if you are injured in an auto accident. Based on your eligibility and individual needs, you'll be able to select from the coverage options available or you may be able to waive PIP medical coverage altogether.

There are several choices available under the new law for Personal Injury Protection (PIP) coverage, but the law imposes certain requirements that may limit your options. Here is a summary of the options that will be available, plus a summary of the eligibility requirements for several selections.

  • Unlimited (with Michigan Catastrophic Claims Association involvement)
  • $500,000
  • $250,000
  • $50,000: This option is available if the insured is enrolled in Medicaid and their spouse and any relative of either who resides in the same household has qualified health coverage, is enrolled in Medicaid or has PIP medical coverage under another Michigan policy.
  • $0 (Waive PIP medical coverage on auto policy): This election by an insured to not maintain PIP medical coverage is available if the insured has Medicare and if their spouse and any relative of either that resides in the same household have qualified health coverage or have PIP medical coverage under another Michigan policy. (Please see the new law for complete details.)

How Meemic can help: When the time comes for you to make a PIP medical coverage selection on your auto insurance policy, first familiarize yourself with your health insurance policy and then select an option.


Cost control of medical services begins.

In July 2021, the fee schedule for medical services will become active, regulating what health care providers charge for auto insurance-related injuries. Recent data shows that health care providers typically bill insurers more than Medicare for the same test – a reason why insurance premiums keep rising. The fee schedule is intended to help control these claim costs.