Michigan No-Fault Insurance Benefits Explained: 2026 No-Fault Update

Michigan’s no-fault auto insurance system provides financial support after car accidents, but the rules changed dramatically with the 2019 reform. If you’ve been in an auto accident or you’re simply trying to make sense of your policy, this guide breaks down every PIP benefit, coverage election, and deadline you need to know. For more information about your case, call the award-winning lawyers at The Buckfire Law Firm today to get your questions answered for free. 

• PIP Medical Coverage Options After July 1, 2020
• What Medical Expenses Does PIP Pay, and For How Long?
• Time Limits, Priority Rules, and Which Car Insurance Company Pays
• When You Can Sue the At-Fault Driver: Bodily Injury and Excess Losses
• Contact Our Michigan No-Fault Attorneys Now

What Michigan No-Fault Insurance (PIP) Pays For Today

Michigan no-fault insurance works by requiring your own insurer to pay PIP benefits for covered medical bills, wage loss, and certain related expenses after a crash, regardless of fault, and Michigan is still a no-fault state. After a car crash, you first look to your own insurance company for personal injury protection benefits, regardless of who caused the accident. The no-fault system ensures quick access to medical care without waiting for fault determination. 

Here’s what no-fault benefits cover right now for car accident victims: 

• Medical treatment for injuries from the car accident, including emergency care, surgery, rehab, prescriptions, and in-home nursing 
• Wage loss benefits at 85% of gross income for up to three years after the accident date 
• Replacement services at up to $20 per day for up to three years, covering household tasks you can no longer perform 
• Survivor’s loss benefits and funeral expenses if the crash is fatal 
• Coverage for pedestrians and bicyclists injured in motor vehicle accidents under Michigan’s no-fault system 
• Transportation costs to and from accident-related medical appointments 

Major reforms apply to auto insurance policies issued or renewed on or after July 1, 2020, with additional fee schedule and attendant-care changes starting July 1, 2021. The amount and duration of some benefits now depend on which PIP medical coverage level you chose when you purchased or renewed your policy. 

Overview: How Michigan’s No-Fault System Works After Reform

Michigan’s no-fault law was originally enacted in 1973 and still requires every driver to carry auto insurance with no-fault coverage. However, the 2019 reform (Public Acts 21 and 22) significantly changed how PIP medical benefits work under Michigan’s no-fault insurance law, creating new choices and new gaps. 

Under Michigan’s no-fault insurance system: 

• Each injured person generally claims personal injury protection (PIP) benefits from their own car insurance company, with insurance companies paying these first-party claims through the injured person’s own policy, not the at-fault driver’s insurance 
• Drivers are covered by their own policy even if the other driver is uninsured 
• An injured person usually has two potential claims: (1) a first-party no-fault PIP claim with their own insurer, and (2) a possible third-party claim or car accident lawsuit against the at-fault driver for pain and suffering and excess economic loss 
• Michigan remains a no-fault state, but people with capped PIP can now pursue excess medical bills against the at-fault driver’s bodily injury liability insurance 
• Michigan’s no-fault system reduces the volume of lawsuits for minor accidents, keeping most claims within the PIP framework 

Every Michigan car insurance policy must include three required coverages: personal injury protection PIP, property protection insurance, and residual bodily injury and property damage liability. No-fault insurance does not cover damage to your own vehicle-that’s handled by collision coverage. 

Watch our “How to Fill Out a Michigan No-Fault Application for Benefits” video.

Personal Injury Protection (PIP) Insurance Basics

PIP insurance is the core of Michigan’s no-fault system. It covers an injured person’s medical bills and certain financial losses regardless of who caused the motor vehicle accident. 

Standard PIP benefits include: 

• Allowable medical expenses: hospital bills, surgery, rehab, prescriptions, diagnostic imaging, physical therapy, and durable medical equipment 
• Up to three years of wage loss benefits, replacing 85% of gross income lost due to injuries 
• Up to $20 per day in replacement services for household tasks you can no longer do, payable for up to three years 
• Survivor’s loss benefits and funeral and burial expenses in fatal accidents 
• PIP covers essential household services if injured, ensuring daily life doesn’t completely stall 

For policies issued or renewed on or after July 1, 2020, PIP medical coverage is no longer automatically unlimited. Drivers can choose different PIP medical coverage levels for their insurance policy. PIP insurance covers medical expenses and lost wages after an accident regardless of which level you pick, but the dollar cap on medical care varies. 

PIP is separate from bodily injury liability insurance, which pays claims others bring against the at-fault driver, and from collision coverage, which repairs your own vehicle. Residual liability insurance protects against being sued for serious injuries caused in an accident. 

Watch our video on “How To Fill Out a Michigan Household Services Statement Form.”

PIP Medical Coverage Options After July 1, 2020

The 2019 Michigan no-fault reform created multiple levels of PIP medical benefits coverage. Customizable coverage allows policyholders to balance premium costs with their risk tolerance. The level you choose determines how much your auto insurance company will pay for accident-related medical bills. 

Here are the options available on policies issued or renewed on or after July 1, 2020: 

• Unlimited lifetime PIP medical coverage – available to any Michigan driver who wants maximum protection; still an option under Michigan law 
• $500,000 PIP medical limit per person per accident – a mid-range option for drivers with some health insurance backup 
• $250,000 PIP medical limit per person per accident – a common choice that carries real risk if injuries are catastrophic 
• $250,000 PIP with exclusions – household members who have qualified health coverage can be excluded from PIP medical benefits 
• $50,000 PIP medical limit – available only if the named insured is enrolled in Medicaid and all household members have qualifying coverage 
• Full opt-out of PIP medical coverage – drivers can opt-out of PIP medical benefits if enrolled in Medicare Parts A and B, and all household members must have qualified health coverage 

Drivers can choose PIP coverage limits of $50,000, $250,000, or $500,000, and unlimited PIP coverage remains available. Qualified health coverage must have a deductible of $6,579 or less to qualify for the exclusion or opt-out options. 

Lower PIP limits reduce premiums but leave auto accident victims more reliant on health insurance and on a car accident lawsuit for excess medical expenses. The Michigan Assigned Claims Plan provides up to $250,000 in PIP medical coverage for certain uninsured people injured in a motor vehicle accident, but eligibility rules are strict, and PIP medical benefits are capped at $250,000 under MACP. 

What Medical Expenses Does PIP Pay, and For How Long?

PIP medical benefits cover “allowable expenses” for an injured person’s care, recovery, and rehabilitation. PIP covers medical expenses after a car accident, but the total is now capped by the elected PIP coverage limit for most Michigan drivers. 

Covered medical costs include: 

• Emergency room treatment and hospitalizations 
• Surgery and doctor visits 
• Diagnostic imaging (X-rays, CT scans, MRI) 
• Physical therapy and occupational therapy 
• Prescription medications 
• Durable medical equipment (wheelchairs, braces, prosthetics) 
• In-home nursing and medically necessary rehabilitation 
• Attendant care for hands-on personal needs 

Before the 2019 reform, PIP medical was always unlimited medical coverage for most policies. Now, payment stops when the elected PIP medical limit is reached. There is no fixed time limit on medical PIP itself (unlike wage loss), but payments are constrained by the dollar cap and by “reasonableness” and “necessity” standards in the Michigan no-fault act. 

Medical providers must follow a Medicare-based fee schedule starting July 1, 2021, which caps how much providers can charge and auto insurers must pay-generally tied to a percentage of the Medicare rate. Some long-term care and attendant care providers have reduced or stopped services because of these reimbursement cuts, making it harder for catastrophically injured accident victims to obtain care. 

Wage Loss Benefits Under Michigan’s No-Fault System

Wage loss benefits under Michigan’s no-fault law replace a portion of income when injuries from a car accident prevent the injured person from working. PIP provides up to three years of lost wages, and this applies regardless of which PIP medical coverage level was selected. 

Key details: 

• PIP pays 85% of gross income (including overtime and certain regular bonuses) that the injured person would have earned but cannot 
• Benefits are subject to a maximum monthly cap adjusted every October 1 by DIFS; for accidents occurring October 1, 2025 through September 30, 2026, the cap is $7,201 per month 
• Wage loss benefits are payable for up to three years from the date of the accident 
• Fringe benefits such as employer-paid health insurance, pensions, and many non-taxable benefits are not treated as lost wages under Michigan’s no-fault system 

Claims for unpaid wage loss must be made in writing to the correct insurance carrier within one year of the accident. If you file a lawsuit for unpaid benefits, you can usually only recover amounts that became overdue within the one year immediately before filing. Missing these deadlines can cost you everything. 

Watch our “How to Fill Out a Michigan No-Fault Disability, Wage, Salary & Benefits Verification Form” video.

Replacement Services, Attendant Care, and Transportation Benefits

Beyond medical expenses and wage loss, no-fault insurance pays for practical supports that help injured victims manage daily life after a crash. 

Replacement services:

• Up to $20 per day for household chores and tasks (laundry, cooking, cleaning, childcare, yard work) the injured person would normally perform 
• Replacement services are available under PIP to help with household tasks after an accident 
• Payable for up to three years after the accident 
• Family or friends who perform these tasks can be paid by the insurer 

Attendant care:

• Payment for hands-on personal care: bathing, dressing, toileting, medication management, supervision for safety 
• Can be provided by nurses, aides, or family members 
• Reform now caps household-provided attendant care at 56 hours per week for policies subject to the July 1, 2021 changes 
• Professional attendant care may exceed that weekly limit 

Watch our video on “How To Fill Out a Michigan Attendant Care Services Form.”

Transportation benefits:

• Reimbursement for mileage or transportation costs to and from medical appointments related to the car accident 
• No-fault pays for trips, not for buying or upgrading a vehicle 

All three categories are considered allowable expenses under Michigan’s no-fault system and must be properly documented with daily logs, time sheets, and receipts to secure payment from the no-fault insurer. 

Survivor’s Loss, Funeral Expenses, and What No-Fault Does NOT Cover

When a car crash is fatal, Michigan’s no-fault insurance provides certain benefits to dependents, but many losses must be pursued through other coverages or an auto accident lawsuit. 

Survivor’s loss benefits:

• Payments to financial dependents of the deceased for up to three years 
• Replaces a portion of the decedent’s income and some replacement services (up to $20/day) 
• Subject to a monthly maximum adjusted annually by DIFS 

Funeral and burial expenses are payable up to the limit specified in the auto insurance policy. 

What Michigan’s no-fault law does not cover:

• Vehicle damage – handled through collision coverage or limited “mini-tort” recovery; the maximum mini-tort recovery cap is $3,000 for accidents 
• Pain and suffering damages – not available through no-fault; requires a third-party claim 
• Most property loss not related to medical care 
• Towing unless separately purchased 
• Rental cars unless rental reimbursement coverage is on the policy 
• Property protection insurance covers up to $1 million for property damage caused to other people’s property, but not your own vehicle 

Financial compensation for pain and suffering and excess economic losses comes from the at-fault driver’s insurer through a car accident lawsuit, not from your own no-fault policy. 

Time Limits, Priority Rules, and Which Car Insurance Company Pays

Michigan’s no-fault act has strict timing and “order of priority” rules that determine when a claim must be filed and which insurer pays. 

• A written notice of injury must be submitted to the proper insurer within one year of the accident date to preserve no-fault benefits 
• The one-year-back rule: if an insurer refuses to pay and a lawsuit is filed, only unpaid benefits that became overdue within the one year immediately before filing are generally recoverable 
• The statute of limitations for personal injury suits is three years from the date of the accident 

Order of priority for car occupants:

• Your own car insurance first 
• Then your spouse’s or resident relative’s auto insurance 
• Then possibly an employer’s insurer 
• Finally, the Michigan Assigned Claims Plan if no applicable policy exists 

Motorcycles are treated differently: motorcyclists injured in a crash involving a motor vehicle often claim PIP benefits from the insurer of the involved vehicle, not the motorcycle’s own insurer. Filing with the wrong insurance company or missing the one-year deadline can result in losing all no-fault insurance benefits entirely. 

When You Can Sue the At-Fault Driver: Bodily Injury and Excess Losses

Even in a no-fault state, Michigan drivers can pursue a car accident lawsuit against the at-fault driver for pain and suffering and economic losses not fully covered by no-fault benefits. You can sue for pain and suffering in Michigan, but only under specific conditions. 

• Non-economic damages (pain and suffering, emotional distress, loss of enjoyment of life) require the injured person to meet Michigan’s statutory threshold: serious impairment of body function, permanent serious disfigurement, or death 
• Injuries must meet a serious impairment threshold to sue – this is defined under MCL 500.3135 
• After the 2019 reform, drivers with limited PIP medical coverage may sue the at-fault driver for excess medical expenses that exceed their PIP limit, as well as wage loss and other allowable expenses beyond PIP caps 
• You can recover excess medical expenses through a lawsuit against the other driver’s insurance company 
• Michigan applies comparative fault: any award is reduced by the injured person’s percentage of responsibility, and if more than 50% at fault, non-economic damages are barred 
• Bodily injury liability insurance must be at least $250,000 per person and $500,000 per accident, with options to go as low as $50,000/$100,000 under certain conditions 

PIP benefits are first-party claims under your own car insurance. Pain and suffering and excess economic loss are third-party claims against the at-fault driver’s insurer. Drivers can sue for pain and suffering if injuries meet statutory thresholds-this distinction is critical for every auto accident victim to understand. 

Choosing the Right PIP Medical Level and Protecting Your No-Fault Benefits

Selecting a PIP medical coverage level is one of the most important car insurance decisions Michigan drivers make. The wrong choice can leave you exposed to hundreds of thousands in your own medical expenses after a serious accident. 

Factors to consider: 

• Whether your health insurance qualifies as qualified health coverage with a deductible of $6,579 or less 
• Your age and Medicare status (Medicare Parts A and B allow a full opt-out) 
• Risk of catastrophic injury costs-surgeries, ICU stays, and inpatient rehab can exceed $250,000 quickly 
• Family size and whether all household members have adequate coverage 
• Your ability to self-pay accident-related medical bills that exceed PIP limits or to wait through a potentially lengthy car accident lawsuit 

Where finances allow, strongly consider keeping unlimited medical coverage or at least a higher PIP limit. Once PIP is exhausted, you must rely on health insurance or litigation for further care. Review your declarations page at each renewal, confirm who is covered, and update elections whenever household composition or employment changes. 

Steps to protect your no-fault benefits:

• File prompt written notice with your own insurance company within one year of the accident 
• Keep detailed medical records, hospital bills, wage documentation, and receipts 
• Follow your doctor’s instructions for medical treatment and attend all appointments 
• Document replacement services and attendant care with daily logs 
• Seek a free consultation with a Michigan no-fault attorney if benefits are delayed or denied 

Contact Our Michigan No-Fault Attorneys Now

If you were injured in a Michigan motor vehicle accident, you likely have questions about our confusing no-fault insurance laws. Call the Buckfire Law Firm today, and we will answer your questions and assist you in filing for benefits. There are no legal fees unless you win, and it costs no money to get started. Call us now! 

Reviewed & Fact-Checked By:

Lawrence J. Buckfire, J.D. – President, CEO & Lead Trial Attorney at The Buckfire Law Firm, in accordance with our Editorial Guidelines & Review Process.

Last Legally Reviewed On: Oct., 2026

Editorial Integrity & Review Standard:

This content has been thoroughly reviewed and fact-checked by Lawrence J. Buckfire, J.D., to ensure compliance with Michigan personal injury statutes, court rules, and current legal precedent. With 38 years of courtroom and trial experience in complex personal injury, medical malpractice, and wrongful death litigation, Mr. Buckfire verifies that all legal advice, information, statutory deadlines (statutes of limitations), and rights outlined on this page are accurate as of the review date.

• Education: B.A., University of Michigan | J.D., Wayne State University Law School
• Bar Admissions: State Bar of Michigan | Ohio State Bar Association | U.S. District Court (Eastern & Western Districts of MI)
• Honors & Recognition: U.S. News – Best Lawyers in America® (Personal Injury Litigation), Super Lawyers® (Top 5%), Martindale-Hubbell® AV-Preeminent Rating, The National Trial Lawyers – Top 100, Multi-Million-Dollar Advocates Forum, Lawyers of Distinction, 3 Best Medical Malpractice Lawyers in Ann Arbor, MI
• Author: Author of 10 consumer legal handbooks on Michigan accident, injury, and medical negligence cases

View Mr. Buckfire’s full Attorney Profile & Trial Record.