If you have attended any of our law firm’s online seminars regarding recent changes to Michigan’s Auto No-Fault Insurance laws, you already know that our lawyers do not support the changes. Some of the most critical auto insurance changes will impact certain individuals through no fault (or decision) of their own, as they will go from having lifetime medical coverage to medical coverage capped at differing amounts, most commonly at only $250,000. Recently, House Bill 5934 was introduced in an attempt to correct the unfair and negative impact of the no-fault reform has for certain cyclists.
Michigan’s Auto Insurance Changes
Under the old law, anyone that was involved in a motor vehicle collision was entitled to lifetime medical coverage for injuries sustained in the crash. Under the new law, all consumers have the right to opt for medical coverage that is capped at $500,000 or $250,000. Additionally, some consumers are eligible to opt for only $50,000 of medical coverage or to simply not include medical coverage as part of their auto insurance policy. However, there are three groups of people that will be limited in their medical coverage even though they don’t choose to opt for limited medical coverage. These three groups of people are:
- Bicyclists who do not own and insure an automobile. Prior to July 2, 2020, when a cyclist was injured by an automobile and was not the owner of a motor vehicle, listed as an insured on an auto insurance policy, or living with a relative who has an automobile insurance policy, they were entitled to lifetime medical coverage from the automobile insurer of the owner or driver of the motor vehicle involved in the collision. Beginning on July 2, 2020, the auto insurance changes impact these individuals in two ways. First, the cyclist now receives their auto insurance benefits through something called the Michigan Assigned Claims Facility. Second, their medical coverage is capped at $250,000.00.
- Similarly, pedestrians who do not own and insure an automobile are impacted. Prior to July 2, 2020, when a pedestrian was injured by an automobile and was not the owner of a motor vehicle, listed as an insured on an auto insurance policy, or living with a relative who has an automobile insurance policy, they were entitled to lifetime medical coverage from the automobile insurer of the owner or driver of the motor vehicle involved in the collision. Beginning on July 2, 2020, people in this situation will also receive their auto insurance benefits through the Michigan Assigned Claims Facility and their medical coverage will be capped at $250,000.00.
- Possibly the most unjust results under the new no-fault law is for those riding a motorcycle that is involved in a collision with an automobile. Motorcyclists receive their no-fault insurance benefits from the insurance company for the owner or driver of the automobile involved in a collision, rather than their own automobile insurance policy. When all auto insurance policies were required to carry lifetime medical coverage, this meant when someone was injured on a motorcycle due to a collision with an automobile, they always received lifetime medical coverage. However, under the new law, a motorcyclist may choose to pay for lifetime medical coverage on their automobile insurance policy but when they are injured in a motorcycle/automobile collision, their medical coverage will be paid based upon the insurance policy purchased by the owner or driver of the automobile involved in the crash. In other words, even though the motorcyclist chose to pay for unlimited medical coverage, they could potentially have their medical expenses capped at only $250,000.00!
Introducing House Bill 5934
Grand Rapids State Representative, Rachel Hood, recently introduced House Bill 5934, which seeks to remedy the unjust manner in which the revisions to the no-fault law was written, as it applies to cyclists. As written, House Bill 5934 would change the $250,000.00 cap to provide for lifetime medical expenses when someone riding a bicycle is injured as the result of a collision or incident involving a motor vehicle. In a press release from Representative Hood, she indicated she introduced this legislation because “I have witnessed first-hand the potentially devastating impact of a traumatic bicycle injury when my husband was struck by a vehicle while biking to work. Thankfully, our family was able to access essential medical care and rehabilitation services, as well as wage loss for the months of recovery where my husband could not work. Without that coverage, my family’s financial situation would have been completely disrupted. I believe that expanding our auto insurance structure will protect the countless Michiganders who ride bikes for enjoyment or for their transportation from the financial burdens of recovering from a significant injury on the roads.”
We hope that other state lawmakers will recognize the importance of the auto insurance changes proposed by Representative Hood in House Bill 5934. Additionally, we encourage cyclists to contact Representative Hood and thank her for her efforts to protect cyclists. E-mails can be sent to firstname.lastname@example.org.