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Michigan Auto Insurance Laws, Minimums, Requirements

What mandatory auto insurance laws exist in the state of Michigan?

  • In the state of Michigan, all motorists must carry liability coverage also referred to as “Michigan No Fault insurance.”
  • Owners of passenger vehicles, vans, light trucks, and motorcycles must purchase the minimum liability auto insurance amounts before registering their vehicle.
  • The minimum auto liability amounts required by Michigan law are as follows: $20,000 bodily injury liability for one person, $40,000 bodily injury liability for all injuries in one accident, and $10,000 property damage liability
  • You must keep your current Michigan No Fault insurance certificate in your vehicle at all times or carry it with you when you drive. There are no exceptions to this rule. If you cannot show proof of current insurance to a law enforcement officer, the court may order the Secretary of State to suspend your driver’s license. Until proof of insurance is shown, the Secretary of State will not renew, transfer, or replace your vehicle’s license plate. You may be required to prove the vehicle is insured for not less than six months and pay $50, plus any other fees required by law. Your plates may also be canceled if proof of insurance is not produced.

 

What is the Minimum Liability Coverage (Bodily Injury amounts per person, per accident, and property damage amounts):

If you buy automobile insurance in Michigan, your policy must include minimum liability coverage of:

$20,000 bodily injury liability for one person,
$40,000 bodily injury liability for all injuries in one accident,
and
$10,000 property damage liability

What are the Rental Car Insurance Requirements?

All registered vehicles traveling on Michigan roadways must carry the minimum amounts of auto liability insurance. This includes rental cars. If you are renting a car for pleasure, most Michigan auto insurance policies provide at least the minimum auto liability requirements. In most cases, the same coverage and deductibles you carry on your car will apply. Check with your insurance agent for details. If you use a credit card to rent a car, it may also cover the minimum liability amounts. Check with your credit card provider for further details.

What are the rules pertaining to Uninsured/Underinsured Motorist Coverage?

Uninsured/Underinsured Motorist Coverage is not mandatory in the state of Michigan and could be a criminal offense.

What are the rules pertaining to the exclusion from coverage of a driver living in household?

In the state of Michigan, insurance companies have the right to ask potential customers to list all household members in order to access their driving records. The insurance company will use these records as part of the rating process. If you are absolutely sure that a household member will not be driving your vehicle, you have the right to exclude them. It is important to keep in mind that if you exclude any household member from your policy, they will not be covered if you change your mind and allow them to drive, even in emergency situations.

What are the rules regarding whether a driver has prior insurance? That is, how does state law handle it if a driver has no prior insurance or has let their previous insurance lapse?

If you allow your insurance to lapse in the state of Michigan, this means that you are driving without insurance. If you cannot show proof of current insurance to a law enforcement officer, the court may order the Secretary of State to suspend your driver’s license. Until proof of insurance is shown, the Secretary of State will not renew, transfer, or replace your vehicle’s license plate. You may be required to prove the vehicle is insured for not less than six months and pay $50, plus any other fees required by law. Your plates may also be canceled if proof of insurance is not produced. You must keep your current Michigan No Fault insurance certificate in your vehicle at all times or carry it with you when you drive. There are no exceptions to this rule.

What are the rules and guidelines auto insurance companies must follow regarding the use of Personal Credit History in selecting applicants and setting rates?

In the state of Michigan, insurance companies can use your Personal Credit History to determine rates and offers for products. It is important to keep in mind that auto insurance companies do not use Personal Credit History alone to figure rates. They also consider age, gender, where you live, car make and model, how much you drive, and prior insurance coverage.

Is the state a No Fault or Tort state? What does either mean to the policy owner?

The state of Michigan follows a No Fault system, which has been in place since 1973. This means that in the state of Michigan, if you are involved in an accident, it doesn’t matter who is at fault. Your insurance covers you, and the other party’s insurance covers them.

What is the average auto insurance premium in this state? As of what year?

As of 2006, Michigan resident’s average insurance premium was approximately $925, the 13th most expensive in the nation. This was down 0.6% from the previous year. The national average was $817.

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