Michigan Auto Insurance Requirements
Michigan has very comprehensive auto insurance laws for both private and commercial vehicle owners. Minimum auto insurance coverage requirements in Michigan are mandated by state law and the Michigan Office of Financial and Insurance Services. The following minimum coverage is required on every registered vehicle, except as noted below:
(Source: Michigan OF&IS)
Driving without the mandatory liability insurance in Michigan are subject to loss of driving privileges and car tags a $500 fine, and jail time. Subsequent offenses are subject to higher fines, reinstatement fees, and jail time.
The Michigan Automobile Insurance Placement Facility (MAIPF) is available to drivers who are unable to obtain required coverage through the voluntary market. More information is available on the MAIPF website.
Factors Influencing Car Insurance Premiums in Michigan
Getting a quote for cheap car insurance in Michigan requires some research and rate comparisons between different insurance companies, because Michigan has the highest auto insurance rates in the country. Some factors that impact insurance rates in Michigan include:
• Michigan is a true “no-fault” state, and requires PIP insurance
• Urban areas such as Detroit have astronomically high auto insurance rates, which impacts the rest of Michigan’s overall average
• Vehicle repair costs are generally more expensive in Michigan than elsewhere
• Overall accident fatality rates are lower than national averages
• A very high percentage of uninsured drivers compared to national averages
• Auto insurance fraud is high
• Vehicle theft rates are well above national averages
The average auto insurance premium for residents in Michigan is $2,541 in 2011; the national average is $1,790.
Tips for Obtaining Cheap Car Insurance in Michigan
• Coordinate PIP coverage with other health insurance policies
• If you’re over 65, you will receive a policy discount if you drive less than 3000 miles per year
• Several insurance companies offer “pay as you drive” car insurance for low mileage drivers in Michigan
• Maintain a good driving record
• Bind multiple policies (homeowners, life, auto) with the same provider
• Maintain a good credit score
• Create a personal “emergency fund” of up to $1500 and increase deductibles accordingly
• Discuss affinity discounts with your insurance provider
• Drop comprehensive and collision insurance on older vehicles
Michigan Statistics
• Auto Theft: Michigan has a high vehicle theft rate, but it has been decreasing (as is the case in most states) consistently over the past 10 years. This can be attributed primarily to anti-theft devices being standard on recent model cars, as well as public awareness of the issue:
(Source: Auto Thiefs)
• Automobile Accidents: The total vehicle miles traveled in Michigan have decreased significantly in recent years, and the vehicle accident fatality rate is among the nation’s lowest.
(Source: National Highway Traffic Safety Administration)
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