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Michigan No-Fault PIP Disqualification

Who Is Disqualified from No-Fault PIP Benefits?

In addition to satisfying the entitlement requirements of Section 3105 and Section 3106, it is also important to establish that the victim is not otherwise statutorily disqualified from collecting benefits under the provisions of MCL 500.3113. This section may act to disqualify insurance benefits to an injured auto accident victim in one of three situations:

  1. the victim was using a vehicle he or she had taken unlawfully;
  2. the victim was the owner or registrant of a vehicle involved in the accident that was not insured as required by the No-Fault Act;
  3. the victim was not a Michigan resident and was occupying a vehicle not registered in Michigan and not insured by a Michigan-authorized insurer;
  4. the person was operating a motor vehicle or motorcycle and named as an excluded operator; or
  5. the person was the owner or operator of a motor vehicle for which coverage was excluded under a policy exclusion, such as an exclusion if the person was using the vehicle for commercial transportation such as ride-sharing or taxi purposes.

Unlawfully Taken Vehicles

An individual is not permitted to collect no-fault PIP benefits if that person was injured in a vehicle that was stolen or that he or she had taken unlawfully. Historically, this category has been limited to denial of benefits for injuries sustained while riding in stolen cars.

However, in a 2012 Michigan Supreme Court decision further restricted this premise, determining that children who take their parent’s vehicle without permission and who are injured while “joyriding” may be denied PIP benefits.

Owners of Uninsured, Involved Vehicles

The Act is very strict with accident victims who own uninsured vehicles and are involved in an accident. The no-fault law makes it clear that any person injured in a car accident without insurance is completely disqualified from recovering no-fault PIP benefits if that person was the owner or registrant of the uninsured motor vehicle that was involved in the accident.

Non-Residents Who are Not Insured Under a Michigan No-Fault Policy

Tom Sinas, Grand Rapids personal injury lawyer, discusses the 2019 changes to Michigan’s Auto No-Fault Law and how it impacts out-of-state drivers.

Effective June 11, 2019, with the passage Michigan’s new auto no-fault law, out-of-state residents who are injured in motor vehicle accidents in Michigan are no longer entitled to PIP benefits. Generally speaking, in the past, residents of other states could receive no-fault benefits if injured in a car crash in Michigan. This meant Michiganders weren’t liable for out-of-state driver medical expenses, even if they caused the accident, until now. Under the new no-fault law, out-of-state drivers are excluded from claiming no-fault benefits, which shifts liability onto the driver that caused the accident.

Persons Who Intentionally Suffer Injury

The No-Fault Act specifically denies benefits to any person whose injuries were intentionally caused by the person wishing to collect benefits. In that regard, the act states that “bodily injury is accidental as to a person claiming personal protection insurance benefits unless suffered intentionally by the injured person or caused intentionally by the claimant.”