Are you a Michigan resident, or planning to drive an automobile in this state? If so, it's essential that you are aware of and educate yourself on the current state laws.

When applying for auto insurance, you must choose the right company. No matter which state you are in, knowing those state rules and regulations will help you to choose and find the right car insurance online. And in the case of filing legal claims, it's crucial to know your rights and benefits.

Michigan Law: Required Policies and How They Protect You

Certain types of insurance are legally required in Michigan. That includes:

  • Property damage insurance. This protects you if you are the one responsible for the automobile accident. It covers the other party's vehicle.
  • Bodily injury insurance. This covers some of the expenses associated with bodily harm which affect the other parties involved.

No-Fault Insurance is Mandatory in Michigan

In Michigan, all drivers must carry No-Fault insurance. This mandatory coverage is your best protection in an accident. Here is what it covers:

  • Your medical treatment after a car accident, no matter who was at fault
  • Passengers and pedestrians who were hurt during the accident and do not have their own no-fault policy
  • Other motorists who were involved in the accident

This no-fault insurance includes the following minimum limits:

  • $20,000 per person hurt or killed in an accident (Bodily injury liability coverage)
  • $40,000 per accident involving more than one person (Bodily injury liability coverage)
  • $10,000 per accident for property damage (Property damage liability coverage)

Michigan drivers are also required to have Property Protection Insurance - also known as PPI. Without this property insurance, you could lose your license, be forced to pay fines, or have your license canceled.

Other Optional Insurance Policies in Michigan

To completely protect yourself in the case of an accident, there are several optional coverages to consider, such as:

  • Collision Coverage
  • Comprehensive Coverage
  • Uninsured/Underinsured Motorist Coverage
  • Mini tort Coverage (Gap Coverage)
  • Accidental Death Coverage (Also similar to life insurance)

You should seriously consider these policies - especially if other family members or passengers in the automobile are not properly insured. It will also cover your property damage and other unforeseeable problems.

Is Michigan Car Insurance Expensive?

Unfortunately for Michigan drivers, the rates for auto insurance are fairly high when compared to other states in the country. According to statistics, folks here pay some of the highest insurance rates of any state in the country. Here's a rough idea of how Michigan stacks up:

  • Michigan drivers pay around $2,610 per year. That's 83% higher than the national average of $1,427.
  • Car insurance premiums in Michigan exceed $6,000 and comprise up to 20% of annual income.
  • Detroit car insurance rates are at the highest, three times more than some other parts of the state

And when it comes to annual car insurance premiums, Michigan is at the top of the list:

  1. Michigan: $2,087
  2. Delaware: $2,073
  3. Oklahoma: $1,990
  4. Kentucky: $1,925
  5. Texas: $1,762

How Can Michigan Drivers Get Lower Rates?

Various discounts are available to Michigan drivers, but one of the biggest is the AARP incentive offered by most insurance companies. If you are an AARP member, you could qualify for up to 20% discounts on car insurance. Just complete their driver safety course, and speak with an agent about your discount.

Of course, you should also investigate the many other kinds of discounts available to you. This may help knock a few dollars off your monthly premium if you're a student with a high GPA, if you have a solid driving record, if you install anti-theft devices in your vehicle, etc.

How Do Car Insurance Claims Work in Michigan?

Michigan currently has two types of automobile accident claims: first party claims and third-party claims. First party claims can only be filed for economic benefits, which include:

  • Medical bills not covered by health insurance
  • Income lost due to an accident
  • Personnel Replacement services
  • Nursing needs and medical care

Third party claims can be filed if the accident was the fault of another driver, but you were injured. Some of the benefits are similar to first person claims.

Why You Need to Choose the Best Auto Insurance

The first step to ensuring you are covered legally and have adequate compensation is to find a proper car insurance company that is aware of Michigan's state laws.

If not, your car insurance policy can actually work against you. Remember that there are unique rules in these state, and varying degrees of costs. Compare costs online before choosing the policy you need. When you become a licensed driver, you must learn the state rules where you will be on the road most often.

And remember, across the country, the same rules apply: When you register your car, have a regular inspection, get into an accident, or are stopped by the police, you must show your auto insurance policy.

Penalties for not having auto insurance are also high and vary from state to state. Check this article to find out the exact costs you will end up paying if you are driving uninsured.