Michigan Auto Accident Laws & Resources
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We’re about to tell you everything you ever wanted to know and more if you were in a car accident in Michigan. You’ll learn what you need to do after your accident and what the average settlement is for a car accident Michigan.
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Michigan Choice No-Fault Car Insurance Rule
This is the key to understanding how car accident settlements in Michigan work. The choice no fault insurance rule basically says that no matter what the first thing to do after an accident you should reach out to your insurance and go through them. It is very rare that the other driver can be held liable for an accident. The only way is if you have a “serious injury”. This is defined as broken bones at a minimum and typically needs to be much more severe.
How Long Do I Have To File A Lawsuit After My Car Accident?
After you’ve regained your composure after your car accident, you will want to reach out to a lawyer. In Michigan statute of limitations is the law that determines how long you have to file a lawsuit. It states that you have 3 years from the date of your car accident to file a lawsuit for personal injury or property damages but only 1 year to file a lawsuit to recover personal injury protection benefits. These time frames only effect court cases and not insurance filings.
The one exception to this is if your accident involved any type of government vehicle. In this case the laws are different but you will need to file quickly in this case, often within 90 days of your accident.
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Auto Insurance Requirements in Michigan
Michigan has a law that requires you to carry a minimum level of car insurance. If you do not do this, you may be fined or even receive jail time. The minimum level of insurance required in Michigan is:
- $20,000 in bodily injury coverage for each person per accident
- $40,000 in bodily injury coverage for every person per accident
- $10,000 for property damage liability
- $20,000/$40,000 for uninsured motorist bodily injury
- Unlimited personal injury protection with a $0, $300 or $500 deductible
If you reject uninsured motorist coverage, it must be rejected in writing. Michigan does not have a requirement to carry additional coverage such as collision, comprehensive or personal liability.
Michigan is a no-fault state. This means your auto insurance must pay for your personal injury claims up to a certain amount, no matter what led to the crash. Under this system, you may lose some of your rights to file a lawsuit for personal injury damage compensation. Under the no fault law currently in effect, there is unlimited medical coverage for drivers hurt in an accident no matter who was at fault. This law is part of the reason that the car insurance rates in Michigan are so high.
However, as of 2018, there is action underway in the state capitol to scrap the current no fault system in Michigan, and return to a tort system, where the cost of an auto accident is litigated in state court. The idea on the table is to adopt a law similar to Ohio, where the injured driver must sue the at fault driver to get their medical costs covered, and to recover lost earnings and pain and suffering damages.
Michigan Accident Settlement Taxes
If you suffered a personal injury, such as in a car accident, and get a legal settlement, you probably wonder if the IRS and state of Michigan will tax your money. Generally, the answer is no, with some exceptions. A key factor in Michigan is the no-fault insurance system that makes no-fault insurance mandatory for all car owners. If you are in a car accident, your no-fault insurance pays for medical costs, lost wages, replacement services, and damage done to property no matter the at-fault party. Due to this law, Michigan personal injury settlements are usually not taxable.
For example, pain and suffering settlements are free of tax, but if you have a confidential settlement, the entire amount may be taxable; check with your Michigan tax advisor.
Wage losses is tax free because it was reduced to 85% under the no fault law. If you are disabled and you file another claim for excess economic loss, the second claim for lost wages would be taxable in Michigan.
If you have any replacement services or care by attendants, they would be taxable because they are income to the individual doing said services.
Disability benefits that are obtained by a guardian for the injured party are not part of gross income, so they are also not taxable.
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Negligence Laws in Michigan
This state has a comparative fault system established for car accident claims. This is a legal concept that is used to determine how much, if at all, the car accident victim might have been comparatively at fault for causing their accident. For instance, if there is a Michigan car crash with two drivers and the first driver was found to be 70% at fault, the other driver is 30% at fault. If the second driver had $10,000 of injuries, this means his compensation will be reduced by $3000.
It is important to understand this concept if you are in a Michigan car accident with injuries and share responsibility for the accident. Note that if your fault is 51% or greater under the law, you are barred from recovering damages. That is why it is very important to retain an experienced, strong personal injury attorney in your Michigan car accident case, who has a complete understanding of the comparative fault system in Michigan.
Car Accident Statute of Limitations in Michigan
According to Michigan Compiled Laws section 600.5805, the statute of limitations is three years after the time of death or date of injury for all legal actions to recover damages. If you attempt to file this lawsuit after three years, it will be dismissed by the judge. This means it is important to give your attorney enough time to get the paperwork filed properly to file a personal injury or wrongful death lawsuit. There are cases where a person or the family waited too long to file the case, just before the statute of limitations was up, and the case could not be filed in time. Be sure you file your case well before the three year deadline.
Other Michigan Driving and Accident Laws
There are several new driving-related laws that have been passed in recent years you should be aware of in Michigan:
- There is a ban on all types of text-based communication when you are driving. There also is a ban on using cell phones for all new drivers.
- In 2012, the state cut a $150 fee that is charged for two straight years for a driver caught if driving without a license, and a $200 fee charged for two straight years for drivers who did not have mandatory insurance coverage.
- In 2013, the state changed the BAC for a DUI conviction from .08 to .10. But a driver who is arrested for driving in a reckless manner can still convicted for DUI even if the BAC is under the legal limit.
- The law now requires all vehicle passengers to wear seatbelts. Children who are less than 4 must be in a safety seat.
- When a car accident happens, the driver must stay on the scene until the police arrive. If you leave the scene before the police arrive, this is a hit and run.
Michigan Car Accident Resources
If you have been in a car accident in Michigan, you would be well served to review the resources below:
- For anyone who has been in an accident in Michigan with injuries, you probably have plenty of medical bills, lost earnings, and pain and suffering. If you are mulling a personal injury claim or lawsuit, Lawsuit Info Center can assist you. This free website is a useful resource that assists injured drivers and passengers to find a good personal injury attorney in their area. The website also is helpful to get a rough idea what your claim could be worth.
- If you were in a car accident in Michigan, it is required to file a UD-10 Traffic Crash Report. If the police responded, they filed one of these forms. If not, you need to do it yourself.
What’s my car accident settlement worth?
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What’s my car accident settlement worth?
- Find out in less than 60 Seconds!
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