Since July 2, 2020 our staff has been very busy explaining the changes that you can make to your Auto policy. Contrary to what you may have heard from the media, if you are happy with your current auto insurance policy there is no action needed until your current policy expires. Only about 10% of our clients having Medicare Parts A & B have opted out. Most are keeping their unlimited medical coverage. The new No-Fault Law, under the Comparative Negligence Rule, allows injured parties to sue for auto injuries. We recommend the purchase of a Personal Umbrella policy which will provide excess liability coverage for your Auto & Home.
WE ARE HERE TO HELP YOU! Please call us for assistance with this process. It can be confusing and we want to make this as easy for you as possible.
A couple of items that we wanted you to keep in mind with the 2020 Auto Reform.
- You now have a choice of your medical coverage limit provided under your auto insurance policy.
- Limited Property Damage coverage will increase from $1,000 to $3,000.
- Michigan State Bodily Injury Liability limits will increase from $20,000 per person / $40,000 each occurrence to $250,000 each person / $500,000 each occurrence.
- MCCA costs will decrease based on the medical option chosen.
Prior to 7/2/2020, an injured person in an auto accident collected benefits in the following order:
- Insurer of the Named Insured;
- Insurer of a Spouse or Resident-Relative;
- Insurer of the Owner or Registrant of the accident-involved vehicle; then
- Insurer of the Driver of the accident-involved vehicle; otherwise,
- Injured Person applies for benefits through the MACP (unlimited)
As of 07/02/2020, an injured person would now collect benefits in this order:
- Insurer of the Named Insured;
- Insurer of the Spouse or Resident-Relative; then
- Injured Person applies for benefits through the MACP ($250,000).
Why are higher Bodily Injury Liability limits important?
If you hurt someone in an auto accident and are found to be negligent, the injured party can sue you for pain and suffering damages. Your Bodily Injury Limits are there to protect you in that sort of lawsuit. With the new law, an injured person will now also be allowed to sue you for medical damages that exceed their own Personal Injury Protection (PIP) limits. Therein lies the reason to select high Bodily Injury Limits – the new law allows a person to select lower PIP limits. This makes it far more likely that an injured person will sue, and you want to be confident your policy limits are high enough to cover you in case of a lawsuit.
FUTURE CHANGES
- 8-year PIP freeze (starting July 2020).
- 56 hour per week limitation on family provided attendant care in the home (starting July 2020).
- A phased-in fee schedule for medical services will regulate what health care providers charge for auto accident-related services (starting July 2021).
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Give us a call if you have any questions as they come about! Stay up to date with our website where we will post any new information that has been released.
We are here to be your Trusted Insurance Risk Adviser!