Car Insurance Requirements in Michigan (2024)

Michigan requires more car insurance coverage than most states and has some of the highest average car insurance rates in the country. Michigan is a no-fault state, which means your insurance will pay for your damages in an accident, regardless of who caused the crash.

In Michigan, you must carry personal injury protection, property protection insurance, bodily injury liability, and property damage liability insurance.

Here’s what you need to know about minimum car insurance requirements in Michigan, and how comparing quotes can help you find coverage that’s right for you.

Michigan car insurance requirements

Michigan has some of the most stringent car insurance requirements in the nation. It’s a no-fault state, so each driver’s car insurance pays for their own damages and medical bills in a motor vehicle accident, no matter who’s at fault.

This means you must carry the following coverages to drive legally in Michigan.

Personal injury protection (PIP)

PIP coverage pays for your medical costs (and resulting loss of income) that you incur because you’re injured in an auto accident, no matter who’s at fault. Michigan drivers can choose from the following coverage levels for PIP insurance:

• Unlimited coverage, which is the default option unless the insured driver chooses a different coverage level

• Up to $500,000 in coverage

• Up to $250,000 in coverage

• Up to $50,000 in coverage, for drivers enrolled in Medicaid

• PIP medical opt-out, for drivers who have both Medicare Part A and Part B health insurance^[1]

Property protection insurance (PPI)

PPI coverage will pay for up to $1 million in damage that your vehicle does to another person’s property in the state of Michigan (but not to other cars involved in the accident, unless they were parked).

Bodily injury liability

This kind of coverage will pay for damages you cause as well as your legal defense if you injure or kill someone in an accident and their own coverage isn’t enough to pay for their medical care. The minimum requirements for bodily injury liability are as follows:

• $50,000 per person

• $100,000 per accident

Michigan has set the default coverage much higher at:

• Up to $250,000 for a person hurt or killed in an accident

• Up to $500,000 for each accident if several people are hurt or killed^[2]

This means you will get the higher coverage limits with your bodily injury liability coverage unless you request lower limits.

Property damage liability

This kind of insurance coverage will pay for the property damage you cause with your vehicle, but only in another state. The minimum coverage requirement for property damage liability is $10,000.^[2]

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Michigan car insurance laws

Michigan’s car insurance requirements changed relatively recently in an attempt to lower the cost of auto insurance.

The old law had the following requirements:

• Mandatory comprehensive lifetime no-fault personal injury protection

• Minimum bodily injury coverage of $20,000 per person and $40,000 per accident^[3]

Under the new law, current requirements are now:

• Drivers must have a tiered choice of PIP coverage instead of comprehensive lifetime PIP

• Minimum bodily injury coverage of $50,000 per person and $100,000 per accident

Do you need more than state-minimum coverage in Michigan?

Michigan’s minimum coverage is considered the same as liability-only coverage. The average cost of liability-only car insurance in Michigan is $171 per month.

The Wolverine State has more minimum coverage requirements than many other states since you must have personal injury protection, property protection insurance, and residual bodily injury and property damage liability.

Together, these state requirements pay for your damages — including medical bills — in a car accident, no matter who’s at fault. They will also cover the other driver if their damages exceed their own personal injury protection coverage.

While you aren’t required to purchase more than the state-minimum insurance, you may want to consider increasing your coverage levels if you drive frequently because damages could cost more than the minimum limits. You may also be interested in purchasing collision and comprehensive coverage, which will pay to repair or replace your vehicle if it’s damaged in a collision or by another event.

If you drive an older vehicle or you can afford to pay out of pocket to repair or replace your damaged car, you may only need liability insurance.

But if you can’t afford to pay to replace your car out of pocket, you may want to get full-coverage insurance. And drivers who are financing or leasing their vehicles may be required to carry full coverage.

The average cost of full-coverage auto insurance in Michigan is $296 per month.

The cost of liability-only car insurance in Michigan

Liability-only car insurance in Michigan includes all the coverages required by law:

• Personal injury protection (PIP)

• Property protection insurance (PPI)

• Residual bodily injury and property damage liability (BI/PD)

Because Michigan requires a relatively robust list of liability coverages, the average monthly cost of liability-only car insurance is the highest in the nation, at $171 per month. This is significantly more expensive than the national average for liability coverage, which is $105 per month.

The following insurers offer the least expensive liability-only coverage in Michigan.

The cost of full-coverage car insurance in Michigan

Full-coverage car insurance in Michigan is the most expensive in the nation, at an average of $296 per month. For comparison, the national average cost for full-coverage car insurance is less than half that amount, costing $202 per month.

Full-coverage auto insurance isn’t a requirement in Michigan or anywhere else, but some drivers may want to purchase it for the additional coverage it provides.

A full-coverage insurance policy provides you with the legally required coverage, collision coverage, which pays for damage to your car from an accident, and comprehensive coverage, which pays for damages to your car caused by anything other than an accident, such as severe weather or theft.

Here are some of the least expensive full-coverage insurers in Michigan.

Penalties for driving without proof of insurance in Michigan

The penalties for driving without proof of insurance in Michigan can be severe. If you’re convicted of driving without insurance, driving someone else’s uninsured vehicle, or allowing someone to drive your uninsured vehicle, you may face up to $500 in fines, one year in jail, or both.

If you cause an accident while driving uninsured, you may also be sued and held personally liable for any damages.

And if you’re hurt in an accident while uninsured, you won’t be eligible for the insurance benefits that are normally covered in an accident. You won’t receive help with medical expenses, lost wages, or damage to your car.

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Optional car insurance coverages to consider

While all Michigan drivers must carry the legally required coverages outlined above, you may also be interested in the following optional coverage types:

• 

  Uninsured/underinsured motorist coverage

  This insurance will protect you if you’re in an accident with a driver who doesn’t have insurance or doesn’t have sufficient insurance. This type of coverage may be a good idea in Michigan, which had the second-highest percentage of uninsured drivers in the United States as of 2019. More than a quarter of drivers were uninsured that year.^[4]

• 

  Collision coverage

  Collision insurance will pay for damage to your vehicle after a collision with a vehicle or another object, like a tree or telephone pole, no matter who is at fault.

• 

  Comprehensive coverage

  If you have comprehensive coverage, your insurance will pay for damage to your vehicle caused by anything other than a collision, such as weather, flooding, vandalism, or theft.

• 

  Towing coverage

  This kind of insurance will pay for the cost of towing your vehicle after a covered event, such as a flat tire, collision, or breakdown.

• 

  Rental reimbursement coverage

  This insurance will pay for the cost of a rental car while your car is getting repaired because of a covered incident.

• 

  Gap coverage

  Drivers of financed cars may be interested in this kind of insurance. If you have gap coverage, your insurer will pay the difference between your auto loan amount and the amount your insurer compensates you if your car is totaled.

Michigan car insurance requirements FAQs