No-Fault Insurance Claims

OVERVIEW OF CLAIMS UNDER MICHIGAN NO-FAULT AUTO LAW

(MCL 500.3101 et. seq.)

 The Michigan No-Fault Statute, and court interpretations of it, can be complicated.  The particular facts of your accident and injuries suffered will affect your rights and benefits.  Please call at us (810) 603-3400 for a free consultation regarding your particular situation.  Our goal below is to provide a general summary of benefits and rights under the Michigan No-Fault Act.

I.

 NO-FAULT FIRST PARTY PERSONAL INJURY PROTECTION (“PIP”) CLAIMS

 As the name “NO-FAULT” implies, Michigan law, provides “PIP” benefits regardless of what or who caused an accident involving a motor vehicle.  Fault is not an issue!  Michigan PIP Benefits may be available to anyone injured as a result of the use, operation or maintenance of a motor vehicle.  This includes more than just drivers and passengers of motor vehicles.  Pedestrians, bicyclists and others injured in an accident involving a “motor vehicle” may also be covered.

“ALLOWABLE EXPENSES” – MCL 500.3107(1)(a) states that an injured person is entitled to recover certain “allowable expenses” described as “all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person’s care, recovery or rehabilitation.” Court decisions interpreting the No-Fault Act have established that the broad term “allowable expenses” may include:

  • products (i.e. wheelchairs, braces, exercise equipment, lift systems, etc.);
  • services (i.e. in-home attendant care provided by family members, friends, nurses, professional health care providers or others);
  • medical and hospital expenses;
  • home or residence accommodations (i.e. ramps, barrier-free wheelchair accessible showers, bathroom facilities, barrier fee home modifications;
  • room and special board expenses;
  • physical and mental rehabilitation;
  • cognitive rehabilitation for closed head injuries, traumatic brain injury;
  • vocational rehabilitation to prepare to you to reenter the work force;
  • handicap equipped motor vehicle transportation and medical transportation mileage;
  • guardianship, conservatorship, fiduciary and probate court expenses or;
  • other benefits that may be covered by the broad term “allowable expenses”

“WORK LOSS BENEFITS” – MCL 500.3107(1)(b) provides an injured motor vehicle accident victim, who cannot work as a result of the accident, WORK LOSS BENEFITS payable up to a maximum of three (3) years from the date of the accident at the rate of 85% of gross pay, including overtime. However, the work loss benefit cannot exceed a monthly maximum, adjusted annually to keep pace with the cost of living.  Also, In addition, accident victims considered “temporarily unemployed” at the time of the accident are also entitled to work loss benefits.

“REPLACEMENT SERVICES” – MCL 500.3107(1)(c) provides REPLACEMENT SERVICE benefits in reimbursement for certain domestic service expenses incurred by injured persons to replace services (i.e. household chores, etc.) they would have performed if the injury had not occurred. These benefits consist of those expenses which are “reasonably incurred in obtaining ordinary and necessary services in lieu of those that, if he or she had not been injured, an injured person would have performed during the first 3 years after the date of the accident, not for income but for the benefit of himself or herself or of his or her dependent.” The Michigan No-Fault Act limits First Party PIP replacement service benefits to a maximum of $20 per day and for a maximum period of 3 years from the date of the accident. Typically, these benefits include such things as household chores, yard work, home maintenance, child care, etc.

WARNING – limited “Replacement Service Benefits” should not be confused with “Attendant Care Services” provided by family members, friends or others under MCL 500.3107(1)(a).  Attendant care services may be available for life and are payable at a reasonable and necessary rate (i.e. not limited to 3 years and $20 per day). Sometimes, voluntary payment of “Replacement Services” at $20 per day by an insurance company can lull a claimant into believing that is the extent of what is available for “Attendant Care”.  This can be a huge mistake because “Attendant Care” is a completely separate and potentially much larger benefit than mere replacement services (i.e. household chores replacement).

SURVIVOR’S LOSS BENEFITS – MCL 500.3108 Survivor’s Loss Benefits may apply when a motor vehicle accident results in death and may be payable to dependents of the decedent.  These benefits include “loss . . . of contributions of tangible things of economic value . . . that dependents of the deceased . . . would have received for support during their dependency . . . if the deceased had not suffered the accidental bodily injury causing death and expenses, not exceeding $20.00 per day, reasonably incurred by these dependents during their dependency . . . in obtaining ordinary and necessary services in lieu of those that the deceased would have performed for their benefit if the deceased had not suffered the injury causing death.” Similar to “Work Loss” benefits and “Replacement Services”, SURVIVOR’S LOSS BENEFITS are only payable for a maximum of three (3) years and are limited to a monthly maximum. Survivor’s Loss Benefits are not simply based on wage loss and may also include loss of fringe benefits, replacement services and other “things of tangible economic value.” Motor vehicle accidents resulting in death also qualify for payment of funeral and burial expenses which shall not be less than $1,750.00 or more than $5,000.00, depending upon the extent of the coverage purchased by an insured person.

The above is simply a general overview of the more typical No-Fault First Party “PIP” claims under Michigan Law.  It is important that claimants consult with a knowledgeable attorney before filing claims, providing recorded statements or signing anything with an insurance company.

WARNING – SHORT STATUTES OF LIMITATIONS AND NOTICE REQUIREMENTS ON “PIP” CLAIMS – MCL 500.3145 provides a very short, strictly enforced statute of limitations and formal notice requirements applicable to FIRST PARTY PIP CLAIMS. Accident victims must act quickly to preserve their rights.  Delay is the most frequent cause of lost rights and benefits.  Time is always critical in legal matters.  Call a knowledgeable attorney immediately.  Feel free to call Attorney Larry Day for a free consultation at (810) 603-3400 to preserve your rights and benefits.

II.

THIRD PARTY TORT LIABILITY CLAIMS BASED ON “FAULT” or NEGLIGENCE of THE DRIVER and/or OWNER OF THE VEHICLE THAT CAUSED THE ACCIDENT

MCL 500.3135 provides persons injured in motor vehicle accidents the right to pursue a tort liability claim against the at-fault driver for two separate and distinct types of damages: (1) noneconomic losses (i.e. “pain and suffering, loss of enjoyment of life, etc.) and (2) excess economic losses (economic losses not covered by the PIP Benefits, discussed above).  The laws governing these two types of tort damage claims are very different and will be applied differently depending on the facts of the particular accident and the specific damages and injuries incurred.   The owner of the “at-fault” motor vehicle may also be liable under Michigan’s Owner Liability Statute.   It is very important to talk with a knowledgeable attorney to fully understand your third party rights and responsibilities stemming from a motor vehicle accident.  The following discussion, by necessity, can only be very general.

(1) TORT or “FAULT” CLAIMS FOR NONECONOMIC LOSS DAMAGES (i.e. “pain and suffering” etc.) may be available per The Michigan No-Fault Act, against a negligent driver (and the owner of the vehicle he/she was driving) if the victim sustained a so called “Threshold Injury” requiring permanent serious disfigurement and/or serious impairment of body function and/or death. There are some unique rules for closed head injury and traumatic brain injured victims.  Most litigated disputes in this area center around the “serious impairment of body function” threshold language.   Analysis of whether an injury meets “Threshold” allowing pursuit of noneconomic damages requires an in-depth investigation and detailed analysis of medical records, treatment and findings that is beyond the scope of the general information provided here.

(2)  TORT or “FAULT” CLAIMS FOR EXCESS ECONOMIC LOSS DAMAGES (economic losses not compensable under First Party PIP Benefits) may be pursued in a tort claim against the party at fault (and/or the owner of the vehicle he/she was operating) for certain economic losses.  These “Economic Losses” may include excess work loss and excess PIP replacement service expense claims. It is important to distinguish claims for excess economic loss from claims for noneconomic loss damages because excess economic loss claims do not require proof of a “threshold injury.”  Special rules apply to claims against uninsured drivers and are beyond the scope of the general information provided here.

I hope the above general discussion has been helpful, but frankly, the Michigan No-Fault Act and judicial interpretation of it over the years, is complicated.  If you’ve been injured in a motor vehicle accident in Michigan you need to talk with a knowledgeable attorney.

Please feel free to call Attorney Larry Day for a free consultation.

Thank you,

Larry

Lawrence J. Day
Attorney At Law
1594 Kings Carriage
Grand Blanc, Michigan 48439
www.lawrencedaylaw.com
lawrenceday@lawrencedaylaw.com

Direct Phone Line: (810) 603-3400

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