Out of State Residents and Michigan Car Accidents

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Out of State Residents and Michigan Car Accident Law

residents of michigan in accidents outside michigan

Out-of-State Residents Injured in Michigan

The Michigan no-fault law and Michigan car accident law in general can be extremely confusing. The rules are endless and the law is often poorly written and provides endless pitfalls for car accident victims and the unwary.

This is especially the case for out-of-state residents injured in Michigan. The recent changes to the Michigan no-fault law have drastically changed and reduced the benefits available to folks who live in Ohio and Indiana and work in Michigan, as well as tourists and other out-of-state travelers who are injured in a Michigan car or truck crash.

Michigan PIP Benefits:

Under the new law, if you are an out-of-state resident, you are no longer entitled to any Michigan no-fault benefits unless “the person owned a motor vehicle that was registered and insured in this state.” MCL 500.3113(c). Michigan no-fault benefits includes things like the payment of medical expenses (hospital and doctor bills), lost wages, prescriptions as well as replacement services and attendant care.

Because virtually no out-of-state residents have a car or truck that is registered and insured in Michigan, almost no out-of-state resident will now qualify for PIP benefits.  

This is a big change from before, when out-of-state residents could enjoy the same access to Michigan no-fault benefits as in-state residents.

Insurance Requirement for Out-of-State Residents:

In addition to the changes in the law, Michigan also has a strange and totally ridiculous requirement that non-residents must follow to be eligible for compensation following a crash within Michigan’s borders. Under 500.3102(1):

(1) A nonresident owner or registrant of a motor vehicle or motorcycle not registered in this state shall not operate or permit the motor vehicle or motorcycle to be operated in this state for an aggregate of more than 30 days in any calendar year unless he or she continuously maintains security for the payment of benefits pursuant to this chapter.

What does this statute mean? It means that a car, truck or motorcycle operated in Michigan for an aggregate of more than 30 days in any calendar year must have Michigan car insurance. And remember the law says aggregate, not 30 consecutive days. So if a person operates a car in Michigan for two week stretches on several different occasions during the course of the year, and that adds up to more than 30 days, that person is supposed to purchase Michigan car insurance for that vehicle.     

For example, if you are an out-of-state student at Michigan State, Western Michigan or Grand Valley University and have a vehicle at school for more than 30 days, it must be registered and insured here in Michigan. If you fail to do so, you will have violated the statute. This applies to anybody, even parents who in the aggregate stay in Michigan for more than 30 days during a calendar year.

It also applies to commuters from Ohio, Illinois and Indiana who just work in Michigan. So, individuals who live in Toledo but work in Monroe County or elsewhere in Michigan must purchase Michigan car insurance. This even applies to snowbirds who live in Michigan for only a few months during the summer.

What are the consequences for not purchasing Michigan car insurance in these situations? Violation of the statute can result in disqualification for pain and suffering damages and the payment of medical bills and lost wages by at-fault driver. Why? Because a person who doesn’t have Michigan insurance is considered uninsured. And under Michigan law, you must have Michigan car insurance on the date of the crash to be eligible for compensation in a negligence case, even if the other person caused the accident.

But how is this possible? How can one vehicle be registered in two different states with two different insurance policies? The answer is there is no solid answer. This statute has not been litigated much because frankly it’s a ridiculous rule. And many lawyers here in Michigan think it’s unconstitutional to begin with.

But in these situations, I would advice a policyholder to contact their insurance agent and ask him or her what the best options are. A rider on the policy stating that the vehicle is operating in two different states may be sufficient.

Other Requirements for Out-of-State Residents:

To get non-economic damages following a crash (pain and suffering, emotional distress, etc.), a non-resident injured in Michigan must prove the same thing a Michigan resident must prove – that the injured person suffered a serious impairment of body function.

A serious impairment of body function can be found in MCL 500.3135, but what it means is that a person must demonstrate the car accident generally changed his or her ability to lead a normal life. Failing to do so prevents the injured person from receiving a dime in compensation. An experienced and knowledgeable Michigan car accident lawyer can help you meet this requirement so you can get a recovery.

However, non-residents get the short end of the stick in another way. Unlike in-state Michigan residents, a non-resident must also prove a “serious impairment” to receive economic losses, such as medical expenses and lost wages. This latter part is different for Michigan residents, who do not have to show a serious impairment of body function to obtain the payment of past or future medical expenses and lost wages from an at-fault driver.

Stacking Insurance Policies:

The good news for out-of-state residents is that unlike in Michigan, many out-of-state insurance carriers permit stacking. This means an injured person can stack the various insurance coverages they have so they can get additional money following a car wreck.

There are two types of stacking – Single policy stack and Multiple policy stacking. But the principle is the same. For example, a Florida resident has 3 vehicles with Allstate and got hit by a Michigan resident who had less insurance than she did. The Michigan resident only had $50,000 in insurance, the state minimum. But the Florida resident has 3 vehicles, each with $100,000 in underinsured motorist coverage (UIM). The Florida policy may allow the injured Florida resident to stack all three policies, allowing that person to receive $300,000 in additional compensation.

That’s why if you are an out-of-state resident, it is important to call a Michigan auto accident lawyer who understands stacking and car accident law. It’s vital to look at the insurance policies and see if they permit stacking. 

The Michigan car accident lawyers at the Lee Steinberg Law Firm P.C. have been helping out-of-state travelers for over 40 years. We know the law and we know how to get the most money possible for our clients. Whether you live in Ohio, Indiana, Florida or anywhere else in the country, call our office toll free at 1-800-LEE-FREE (1-800-533-3733) if you have been injured in a Michigan accident. We don’t change a penny until we win your case and our dedicated team of Michigan auto accident lawyers will help you every step of the way.