A lot of people who are new to Michigan do not understand why we as a state have no-fault insurance. Truth be told, there are a lot of Michigan residents who believe that this form of insurance should be removed and replaced. But what are the facts about no-fault insurance? Is it very helpful or is it more of a headache than anything?

The truth about it is that in the unfortunate event of a catastrophic event while in your vehicle, no-fault is designed to provide unlimited medical coverage if you're hurt in a crash. This also means that our monthly payments are very high. However, by replacing no-fault with the other type of insurance, a pure tort system, we would see drastic decreases in monthly payments by almost half while catastrophic payouts would be less.

According to FOX 2 Detroit, Republican lawmakers have introduced a new bill which would change us from a "no-fault" state to a "pure tort system" state. The end result would save everyone money monthly but may limit what is covered in terms of any injuries you have as a result of a crash.

Michigan Auto Law employee Steve Gursten explained the differences in the two types of insurances and how they would affect a particular situation:

In a pure tort state, you're going to get compensated for a broken wrist. In Michigan, depending on how that broken wrist has impaired your life, you may get compensation or you may get nothing.

State Representative also commented on why statewide insurance prices are another reason why change must occur:

We are the highest cost insurance auto insurance in the country because of the cost drivers in the system, which are unlimited lifetime medical care that costs exorbitant rates by comparison for what health care costs for the same thing. Repealing it actually makes a lot of sense.


Personally, I feel that the high insurance rates are why according to carinsurance.com last year, over 20% of drivers were uninsured. We will have to wait and see if the bill can get passed. Would you like no-fault insurance to go away?




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