Breaking Down Michigan No-Fault Law

by / / Published in No-Fault Law

The Michigan no-fault law is an example of a tort law aimed at helping accident victims receive their medical expenses.  While this is become under fire with the latest attempts at no-fault reform, it’s important to understand the underlying concept of the law to decide if it’s good or bad for our state’s residents.   It is the first thing that accidents victims and their loved ones should look into with the help of a qualified lawyer. The no faults law consists of two main parts namely the first party claim and the third-party claim. The law states that any person involved in a motor accident qualifies for no fault benefits. This rule applies even if the person caused the motor accident. In some cases, the no fault benefits go by the phrase ‘first-party benefits’ or ‘personal injury protection benefits’. Read on to find a complete breakdown of how the first party benefits claim and the third-party benefits claim work.

The first party benefits go to any individual who is involved in a motor accident. The benefits cover economic losses such as reimbursement for medical expenses and lost wages as well as cost of nursing. The claims are easy to quantify and are made to the insurance company nearest to the individual in the following arrangement as his or her own cover, a family cover, the driver’s cover or the state. The only disqualification for this rule happens when the claimant who owns the vehicle involved in the accident neglects to purchase insurance for it.  When it comes to the third-party claim, the claimant usually seeks compensation of the negligence of the vehicle operator or owner. In this regard, the plaintiff has to sue the other party for compensation and would have to state clearly the losses incurred that inform the claim for compensation. The no-fault law in Michigan restricts the use of third-party claim to losses that would be classified as death, a significant impairment of body function and/or permanent serious disfigurement.

Many accident victims go for the significant impairment claim that obliges them to prove that they are unable to lead their normal lives because of the accident. In all cases, the plaintiff will have to supply medical evidence to show pain and suffering. This requirement makes it difficult for soft tissue injuries and other non-physical harm. In addition to the compensation for pain and suffering, the victim also qualifies for economic loss compensation as long as they are involved in a motor accident. This claim takes care of any additional cost incurred by the victim that would not form part of the compensation available in the first party rule. In many cases, as a plaintiff, you will recover from losses coming from lost wages as well as the cost of replacement services that were beyond the threshold of the first party provision.  The no-fault law allows the first party benefits for wage loss and other economic losses to last for three years after which the third-party benefits kick in when the victim proceeds to sue the vehicle owner or operator. It important to note that the pursuit of third-party benefits is optional for the victim and may not be necessary when the first party benefits are sufficient to cover all loses. In the end, victims of motor accidents are able to get accident compensation even when they do not personal own an insurance policy. In case the operator’s or driver’s insurance is insufficient to cover the cost of third partly benefits then the victims additional coverage will step in to ensure full benefits are paid.

As a victim, you may have to resort to your insurance cover when the negligent party lacks any form of insurance cover that would honor the third-party benefits. The compensation you get for the uninsured or underinsured motorist coverage will only cater for economic losses. The victims insurance cover provider will only step in to pay for the economic losses when there is sufficient evidence to indicate that the other party’s cover is insufficient.  The no-fault law limits the liabilities of the motor accidents victims with its third-party compensation provisions as a way to make motor owners and operators responsible for road safety. The third partly claim provision under the law is the only way that lets you recover the cost of damages that you incur when you become a motor accident victim and the first party claim compensation is insufficient.

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