While there are several implementation dates that affect the recent no-fault reform law, the vast majority of provisions do not take effect until July 1st, 2020. However, there are certain provisions that took an immediate affect after the passing of the law.
As in the past, the Named Insured, secondary named insured, spouse of the named insured (or secondary named insured), resident relatives of the named insured (or secondary named insured) are all considered eligible for personal injury protection (PIP) benefits. These would be listed and rated on the policy, or in some cases like young children, just included in the household member count. In the event of an accident involving a motor vehicle, these people could make a claim for PIP benefits under the auto insurance policy.
Moving forward, listed drivers living in the household that are not related to the named insured and not designated as a secondary named insured cannot make a claim for PIP benefits under the auto insurance policy. In an accident, these individuals would make a claim for PIP benefits through the Michigan Assigned Claims Plan, limited to $250,000. The only way for two unrelated, unmarried adults living in the same household to both be eligible for PIP benefits from the same policy is if the second person is designated as a secondary named insured.
Drivers that don't live in the household generally cannot make a claim for PIP benefits under an auto insurance policy. In most cases, these drivers would need to be the named insured on their own policy to make a claim for PIP benefits under an auto insurance policy. The main instance in which this exclusion would apply is if a child is still listed on a parent’s auto insurance policy after they are no longer in school and do not reside with the parents. In order to be eligible for unlimited PIP benefits, these drivers would need their own policy. The most notable exception to this is a college student away at school, as those students can remain on their parent's policy until they move out.
We know that there are always unique circumstances that are difficult to fit into a standard policy example, so please contact us if you have questions.