Who Pays the Deductible in a Michigan Car Accident?
The state of Michigan requires drivers to have no-fault automobile insurance. This is because there is a no-fault law in place for car accidents. This type of insurance has three basic coverages:
- Medical bills, replacement services, and lost wages if you get injured in an accident
- Paying for the damage your vehicle does to someone’s property other than a car
- Payment in the event that you get sued and seen to be liable for injury to others
It doesn’t matter whether you are at fault or not. One of the most common concerns in car insurance is a deductible from collision coverage. Read on to gain more understanding of this expense.
Collision Coverage and Deductible
Collision coverage is not required by law. This type of coverage helps in paying for the repair or replacement of your car after an accident. This will be paid regardless of who is at fault. If you don’t get collision coverage, all expenses will be out of pocket.
You can choose to sue the at-fault driver. You can recover up to $1000 for the damages they caused not covered in your insurance. The at-fault driver is the one who is more than 50% responsible for the accident.
Collision coverage normally comes with a deductible. A deductible is a specific amount you choose to pay for car damage before the insurer pays anything. Companies provide different deductibles.
Deductibles typically range from $250 to $1000. Consider the value of your car when deciding on the amount. The price of collision coverage also decreases as the deductible amount increases.
Paying Deductibles in Michigan
You need to have collision insurance if you want your insurer to cover car damages. There are three types you can choose from: standard, limited, and broad form.
The matter of deductibles and who pays for them immediately follows after someone gets injured in an accident. There are three scenarios related to Michigan’s auto no-fault insurance law:
- Accident-related medical bills are paid via no-fault coverage
- In the event that the car accident victim’s injuries prevented him from returning to work – the lost wages are paid through no-fault coverage
- The costs incurred for fixing vehicle damage due to the accident is paid through the collision coverage
No-Fault Medical Benefits Deductibles
You need to pay for deductibles if you included them in the no-fault coverage for accident-related medical bills. This is also true even if you are not responsible for the car accident.
In exchange for agreeing to a specific amount of deductible, the insurance company will reduce your premium rates.
No-Fault Wage Loss Benefits Deductible
If your no-fault coverage has a deductible for lost wages, you still need to pay. Just like with medical benefits, your insurer needs to give you a lower premium.
Deductibles For Those Who Are More Than 50% At Fault in Michigan
You’ll pay the deductible if you are more than 50% accountable for the accident that damaged your vehicle. Check if you have broad form or standard collision coverage in your policy. The deductible amount depends on what you chose for your policy.
Keep in mind that if you only have limited collision coverage, you will have no deductible. Limited collision coverage doesn’t pay for any deductible.
Deductibles For Those Who Are Less Than 50% At Fault in Michigan
You don’t have to pay if you are less than 50% accountable for the accident that damaged your vehicle. Review your policy again to confirm if you have limited collision or broad form coverage. The deductible is waived by law if you’re not “substantially at fault.”
Unfortunately, you still need to pay the deductible if you only have standard collision coverage. This is regardless if you are 100% at fault or not.
Know More About Your Rights and Responsibilities Under Your Auto Insurance
Still confused if you need to shell out money for deductibles? The Michigan Department of Insurance and Financial Services has a brochure that provides helpful information on the topic.
You should consult a Michigan car accident lawyer to guide you through the technicalities. Our team at The Clark Law Office is up to the task. Book a consultation with us today.