Introduction Michigan “First Party” Benefits in Auto Accidents
Ask anyone who has been involved in a car crash in any state and chances are high that the individual will say one of the scariest and/or most frustrating aspects of the ordeal – aside from the crash and any resulting injuries they sustained – is dealing with the insurance companies. Insurance companies have a reputation of being pushy and concerned about their “bottom line” – settling claims and losses as fast as they can and for as little money as possible. This makes it so some crash victims dread a call from an insurance adjustor, even if the adjustor works for the victims’ own insurance company.
Every state requires drivers to have some form of auto insurance, but the way in which these insurance policies operate and what types of losses they cover can vary greatly from one state to another. This is true in Michigan, where drivers must generally carry “first party” insurance policies to protect them in the event of a crash. How these policies work, however, can be a source of confusion.
What are “First Party Benefits” in Michigan?
Each state can be classified as either a “no fault” or a “fault-based” state depending on how that state’s laws handle car accident injury claims. In a “fault-based” state, an injured motorist or passenger can file a claim against for monetary damages against the driver the motorist or passenger believes to be “at fault” in causing the accident. The injured motorist or passenger can also bring a claim against the at-fault driver’s insurance carrier. Conversely, in a “no fault” state, injured motorists would first file claims for compensation with their own insurance carriers, who are required to pay legitimate claims arising from a car accident without regard to which driver caused the accident. Michigan and a minority of other states that follows the no fault approach.
Following a car accident in Michigan, there may be one of two claims filed against an insurance company. A “third party” claim is one filed by a person other than the insurance company’s insured client and/or his or her family members, and these types of claims are permitted in certain circumstances. The other type of claim is a “first party” claim, and this is a claim for compensation filed by an injured person with his or her own insurance company. Michigan requires drivers to carry “first party” insurance coverage for themselves.
In the event of an auto crash, these policies will typically provide compensation for the following losses:
- Medical expenses: This includes the cost of any hospitalization necessitated by your crash-related injuries as well as follow-up visits with a doctor or surgeon, prescription drug costs, expenses associated with obtaining a necessary medical device, and rehabilitative or therapeutic costs;
- Lost income: If you miss time from work, a first party insurance policy will typically allow you to recover the value of the wages you were not able to earn because of your injury. Under some policies, you may be able to recover lost wages for up to a three-year period.
- Household services: Being injured in a car accident can not only keep you from your job, it can also prevent you from performing tasks around the home that you are accustomed to doing. These tasks include doing laundry, fixing meals, maintaining your yard and home, and other similar chores. If you are accustomed to performing these tasks but are no longer able to do them (either temporarily or permanently), your first party insurance benefits may provide compensation so that you can obtain the services of someone else to complete these necessary tasks.
- Funeral costs: In the event that your car accident causes your death, your first party insurance benefits would provide your surviving family members with a limited death benefit. This benefit is designed to address the costs associated with conducting a funeral or memorial service and disposing of your body (whether through burial, cremation, or some other method).
- Disability-related remodeling: Finally, if you require modification of your home as a result of the disabling injuries you received in your Michigan car crash (if, for example, you are confined to a wheelchair as the result of your injuries), your first party insurance benefits may be able to assist you with the costs of such remodeling. In the case of a victim who is now confined to a wheelchair, for example, you may be able to receive assistance in widening your interior and exterior doorways to accommodate your wheelchair.
Call Stern Law, PLLC for Assistance After an Auto Accident
This is not an exhaustive list of all first party insurance benefits that may be available to injured Michigan drivers and passengers, so it is important to contact Stern Law, PLLC following a Michigan auto accident to learn what your exact rights are. Call Stern Law, PLLC at (844) 808-7529.