Before you can determine how much car insurance coverage is appropriate for your situation, it helps to get an understanding of what the law actually requires in your state.
When it comes to car insurance, the first thing to understand about Michigan is that it is a "no-fault" car insurance state. Vehicle owners are required to purchase and maintain certain levels of insurance for any car or truck they register and plan to operate. And after a car accident, drivers turn to their own car insurance coverage first (and usually exclusively) to get compensation for medical bills and other losses, regardless of who was at fault for the accident. For more information on how Michigan's no-fault system works, check out our article Michigan No-Fault Car Insurance Rules and Regulations.
The minimum requirements for car insurance coverage on vehicles registered in Michigan are:
|
Coverage Type |
Michigan Requirements |
|
Bodily Injury Liability |
$20,000 per person/$40,000 per accident |
|
Property Damage Liability |
$10,000 |
|
Uninsured Motorist |
Not required |
|
Underinsured Motorist |
Not required |
|
Medical Payments |
Not required |
|
Collision |
Not required |
|
Comprehensive |
Not required |
|
Personal Injury Protection (PIP) |
Unlimited on medical |
|
Property Protection |
$1 million limit |
Remember that these are just the minimum amounts of coverage required under Michigan law. In some cases you can and should add additional protections to your car insurance policy. For example, even though the state doesn't require you to carry comprehensive coverage, you may need it if you're leasing or financing a vehicle. Learn more about Types of Car Insurance Coverage.
If you drive a car in Michigan without the mandatory insurance coverage, the penalties can be severe. For the first offense, you can be fined up to $500 and imprisoned for up to one year. Additionally, your license will be suspended for at least thirty days.
There are practical consequences as well. If you cause an accident and you don't have adequate (or any) insurance coverage, you will be personally responsible for paying any damages out of your own pocket, which could easily run into the tens of thousands of dollars.
For more information on car insurance in Michigan, check out the state's official Consumer Guide to Auto Insurance in Michigan.