Major Requirements for Car Insurance in Michigan

It is common knowledge that auto insurance requirements differ from state to state. Car insurance requirements in Michigan specify that all registered cars need to have at least the minimum state-required insurance coverage plan before they can be driven on the state's roads.

The Secretary of State (SOS) made the call for the implementation of a mandatory no-fault insurance for car owners in Michigan. The advantage of this type of coverage is that it protects the car owner and his family so that in the case of an accident, whether or not he was at fault, his insurance company pays him. The plan covers certain basic benefits such as unlimited medical, rehabilitation benefits and loss of wage. With this basic plan in place, if a car owner or family member is hurt or injured due to an accident, he will not have to pay the medical bill out of his pocket.

Here are the major requirements as it relates to car insurance in Michigan.

1. Liability insurance requirements for private passenger vehicles (no-fault insurance).

The Secretary of State requires that car owners at least be able to meet the following minimum protection coverage for bodily injury and property damage (BI/PD insurance coverage).

* Injuries or death to one person in a single accident …. $20,000.

* Injuries or deaths to more than one person in a single accident …. $40,000.

* Property damage …. $10,000.

These are often referred to as 20/04/10. Additionally, car owners are required to carry:

* Personal injury protection (PIP) - takes care of all medical cost associated with injuries from an auto accident.

* Property protection insurance (PPI) - pays up to $1 million to cover damages you may have caused to other people's property with your car. This must be in Michigan.

2. Acceptable proof of financial responsibility

Motorists must travel with their insurance certificate while driving. This allows them to have on-the-spot proof of proper insurance coverage to show if they are stopped by the police, or if they are involved in an accident.

3. Penalties for failure to maintain financial responsibility

Failure to meet the state's insurance standards could result in the suspension of the car owner's license, and they will not be allowed to renew their registration or replace the vehicle's license plate. Their registration could also be cancelled. In order to resolve the situation (suspension of license and registration) the car owner will have to provide proof of coverage and pay a fine of $50.

The Importance of Added Auto Insurance in Michigan

Having sufficient coverage is important. If the car owner is underinsured he will have to bear the cost for any medical and/or property damage from his own pocket. There is a number of auto insurance coverage that motorists in Michigan can add to their policy. Collision and comprehensive coverage will offer the car owner several protections. This includes protection coverage against:

* Accidents:

No one can tell when an accident might occur and no one can totally avoid an accident. It is best to have added coverage as the cost of a single accident can deplete one's basic coverage. Road conditions play a major role in road accidents. The 2011 Michigan Traffic Crash Fact statistics indicates that wet road conditions caused 50,991 crashes while snowy conditions caused 21,105 crashes for that year.

* Thefts:

Auto insurance rates are affected by auto thefts. In 2009 Michigan was rated as one of the top 10 states for most stolen cars. This high trend of theft negatively affected the car insurance ratings that car owners in Michigan had to face. The rate of theft declined in 2011, and according to the Michigan Automobile Theft Prevention Authority (ATPA) in their biennial report, that decline resulted in Michigan motorists saving nearly $51 for each insured vehicle. Without comprehensive coverage the car owner will not be able to make a claim to cover the cost of replacing the vehicle. It is best to purchase collision and comprehensive coverage for that added protection or the victim faces the possibility of finding the money to replace the vehicle in their pocket. The top ten most stolen vehicles in this state (in no particular order) are:

1. 2000 Dodge Caravan

2. 2000 Dodge intrepid

3. 1999 Dodge Caravan

4. 2002 Jeep Cherokee

5. 1996 Dodge Caravan

6. 1997 Dodge Caravan

7. 2002 Dodge Intrepid

8. 1997 Ford Taurus

9. 1998 Dodge Caravan

10. 1999 Dodge Intrepid

Michigan Car Insurance Rates

Car insurance ratings in Michigan are regulated by state law, but on a competitive basis. Insurance providers must keep their rates competitive (not too high or too low) with the existing rates. There are 65 companies featured on the government's list of insurance providers. The insurance rate that car owners have to pay varies from individual to individual. Insurance companies in Michigan are eager to supply auto insurance quotes. Car owners can collect quotes from a few companies and compare the rates. The variation in auto insurance ratings in Michigan is determined by several factors which are allowed by state law.

These include:

* Driver's age and experience.

* Type of car they drive.

* Number of traffic tickets they have been issued.

* Amount of accidents they have been involved in.

* Where the insured lives.

* Number of policies the insured has with the company.

Insurance companies tend to be particularly hard on younger drivers due to their tendency to be involved in accidents. The 2011 Michigan Traffic Crash Fact indicates that young drivers between the ages of 15 and 25 were responsible for a total of 284,049 motor vehicle crashes. Insurance companies consider them a risk and charge higher rates for their coverage. Cheap car insurance is available in Michigan, but the car owner must be willing to research the various insurance providers and compare rates. It is best that they collect a few car insurance quotes from the companies authorized to operate in Michigan and do a comparison before making a selection. According to the Michigan-based carinsurance.com, the average premium for insuring a car in the state in 2010 was $2029.00, which was above the national average of $1577.00.

The auto insurance regulator for the state of Michigan is The Office of Financial and Insurance Regulation (OFIR). [http://www.michigan.gov/lara/0,4601,7-154-35299_10555 - -- ,00.html]. No-fault insurance may be mandatory, but car owners can decide how much to pay and which insurance company to use. OFIR provides online tools that make it easier for car owners to conduct their search. They provide vital information on legitimate auto insurance providers, and relevant information on auto insurance ratings in the state of Michigan. This will prove helpful in identifying cheap auto insurance in Michigan.

Seat Belt Usage Laws in Michigan

There are strict laws governing the use of seat belts in the state of Michigan. Law enforcement officers can stop and ticket any motorist who fails to observe these laws. In 2009 the state of Michigan was noted as having the highest seat belt use in the nation. The 2008 statistics showed that there was 97.2 percent seat belt usage in the state.

The primary seat belt law for the state of Michigan stipulates that passengers between the ages of 8 and 15 should wear a seat belt at all times. Drivers and passengers seated in the front should also wear their seat belt at all times. Car or booster seats must be used for children under four years old and this must be placed in the back seat.

Law enforcement in Michigan has a no-tolerance rule for seat belt offenses. They have dubbed their seat belt enforcement campaign as "Click It or Ticket."

Getting behind the wheel of a car comes with more responsibilities than many realize. Accidents are costly, and for many the associated cost would be unaffordable without coverage. Insurance coverage may be costly, but they offer valuable financial protection.