Which insurance company pays benefits for injured motorcycle passengers?
You should also understand that an individual injured while riding as a passenger on a motorcycle can seek the same coverage as the operator of the motorcycle, with the same priority system. However, there is one additional layer of coverage for passengers. Injured motorcycle passengers will seek coverage using the priority system listed above. However, if the injured passenger is unable to find coverage through any of those options, that passenger will then turn to his or her own insurer to seek coverage, before looking to the Assigned Claims Facility.
Order of priorities in a motorcycle hit-and-run
As stated, the vast majority of injured motorcyclists will obtain their no-fault benefits from the insurance company of the driver of the motor vehicle involved in the accident. But what happens in instances of motorcycle hit-and-run accidents?
In one recent Michigan Court of Appeals case, the driver of the car fled the scene after impact. Under normal circumstances and according to Michigan’s no-fault priorities, the injured motorcyclist would turn to the insurer of the vehicle involved or the insurer of the operator. However, since it was a hit-and-run and the insurance information was unobtainable, payment continued down the list of priorities, falling to the motorcyclist himself.
This is where the confusion came in. While the motorcyclist didn’t own a motor vehicle, Progressive insured the motorcycle itself. Furthermore, at the time of the hit-and-run, the motorcyclist was living part-time with his mother, who owned vehicles (and therefore a no-fault policy) insured by State Farm. Progressive and State Farm agreed that the motorcyclist was entitled to no-fault benefits. However, they disagreed on who was responsible for payment.
State Farm argued that, because the motorcyclist wasn’t named on his mother’s no-fault policy, they weren’t on the hook for payment of benefits. Progressive countered that, because the motorcyclist lived with his mother, State Farm should pay the no-fault benefits under the “resident relative” provision of State Farm’s policy.
In the end, the Court of Appeals agreed with Progressive. As the “motor vehicle insurer” of the motorcyclist’s mother, State Farm was responsible for the payment. Because of the resident relative clause, naming the motorcyclist himself on the policy wasn’t required. It’s worth mentioning that, had all four priority levels failed, the motorcyclist could have pursued a no-fault claim through the Michigan Assigned Claims Plan. Additionally, motorcyclists may also purchase optional coverage known as motorcycle PIP coverage in increments of $5,000 or more. This coverage will pay for any injuries arising from accidents that don’t involve another motor vehicle or motorcycle hit-and-run collisions.