Beginning July 2nd, 2020, auto policy coverage requirements in Michigan are changing. With these new law changes, drivers with qualified health coverage could potentially save money by reducing their auto insurance coverage. Anyone with a car insurance policy that begins or renews on or after July 2nd will have the option of choosing a lower coverage amount for their personal injury protection (PIP) coverage. Previously, Michigan drivers were required to have unlimited PIP coverage, but options now range from unlimited to no coverage at all.
Reducing one’s PIP coverage will provide a reduction of insurance premiums according to the Michigan Department of Insurance and Financial Services. It may be appealing to some drivers to lower or opt out of PIP coverage, especially if they have qualifying health insurance.
To find out if their health plan covers auto accidents and to what extent, employees will need to call the number on the back of their health insurance card. All members on the auto policy should have a qualifying health plan. They should request a document stating what their plan covers when it comes to auto–related accidents. They can use this document when enrolling in or renewing their auto policy.
Overall, it is worth it for drivers to investigate lowering their PIP coverage to see what they could save. Being covered by a qualified health plan can result in savings on car insurance premiums and stops drivers from paying for injury protection under two different policies. However, it is important to consider all of the factors before deciding which coverage option is best.
One factor to consider is the health plan deductible and out-of-pocket maximum that might need to be paid if there are serious injuries resulting from an accident. The savings on car insurance premiums might not be worth it compared to the potential liability with health insurance. Another factor to consider is that drivers without PIP coverage will not be covered for lost wages. Employees should speak directly with both their car insurer and health insurance carrier to determine affordability and risk.
For more information of specific law changes and how to choose the coverage that is best for you, go to https://www.michigan.gov/autoinsurance.