Is Michigan an At-Fault or No-Fault State?
Who pays after a crash depends on the fault system your state uses.
- Fault system
- No-fault
Your own insurer pays your medical and wage loss benefits regardless of who caused the crash. Tort liability is abolished except for the exceptions in MCL 500.3135(3) — see the mini-tort row.
- Comparative negligence rule
- Modified comparative — 51% bar on noneconomic damages
Damages are reduced by your share of fault, and no damages at all are awarded to a party more than 50% at fault. Two Michigan-specific bars go further: a person injured while driving their own uninsured vehicle recovers nothing in tort, and mini-tort damages are not awarded for a vehicle that was being operated without the required security.
- PIP minimum limit
- $50,000 floor for Medicaid enrollees; $250,000 for everyone else who buys down; unlimited by default
Since July 2, 2020 each driver elects a PIP medical ceiling — unlimited, $500,000, $250,000, $250,000 with exclusions, $50,000 for Medicaid enrollees, or no PIP medical for Medicare Parts A and B enrollees — and the policy defaults to unlimited if no valid election is made. That election changes who pays after a crash: an at-fault driver can now be sued for the injured person's allowable expenses and work loss above that cap, or without limit where the injured person opted out. This exposure did not exist when every Michigan policy carried unlimited PIP, and it is the practical reason the default bodily injury limits were raised to 250/500 at the same time.
- Mini-tort limit
- $3,000
Michigan abolishes tort liability except for the exceptions in MCL 500.3135(3). The one most drivers meet is the mini-tort: for crashes after July 1, 2020 a driver 50% or more at fault can be sued for up to $3,000 of vehicle damage insurance did not cover — usually the other driver's collision deductible. The cap was $1,000 for earlier crashes. These go to small claims or district court.
What changed
July 2, 2020
Mini-tort limit tripled from $1,000 to $3,000
MCL 500.3135(3)(e) now allows damages of up to $3,000 for vehicle damage not covered by insurance for motor vehicle accidents occurring after July 1, 2020; the $1,000 cap still governs earlier crashes. The rest of the rule is unchanged: the defendant must be 50% or more at fault, a driver with collision coverage recovers only the deductible, and no mini-tort damages are awarded for a vehicle that was being operated without the required security. Several Michigan state pages written before the reform still say $1,000.
Mich. Comp. Laws § 500.3135