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Revisiting Your PIP Decision

Despite the state changing our No-Fault auto insurance laws a few years ago to give us options for Personal Injury Protection (PIP) other than Unlimited, I’ve continued to recommend keeping Unlimited PIP.  Why?  Because it’s still the best protection from going broke and having a crummy quality of life if we (or our children) are severely injured in an auto accident. 

In addition to giving us new options for PIP limits, our new No-Fault auto insurance laws also changed how auto accident medical bills would be paid.  Now, rather than medical providers charging what they deemed fair, they have to accept a predetermined amount according to a schedule of services and fees created by the State of Michigan (referred to as the No-Fault Fee Schedule).  This is similar to how Medicare pays bills.

In an effort to open some eyes to see that the lower PIP options aren’t as scary as many thought, one of our insurance companies tested the No-Fault Fee Schedule.  They applied the No-Fault Fee Schedule to claims they paid from 2017 through 2021.  Their results showed that the odds of having auto accident medical costs exceeding $500,000 were incredibly low – way less than 1%.  These findings also indicate that our PIP dollars get us more medical services and treatments than it would have prior to our No-Fault Auto Reform!  This is new information.  I’m now seeing less risk in giving up Unlimited PIP.

Personally, I think it’s important to revisit old decisions in light of new information.  For example, I once disliked coffee, thought I’d never marry a younger woman, and I’d never live in a town like Frankenmuth.  Then I realized there’s more out there than Folgers… and then I met Mrs. Michael.  Well, now I’m having coffee with Mrs. Michael, in Frankenmuth, and I consider myself a lucky man. 

I still think those of you with dependents should keep Unlimited PIP.  However, if you have no dependents, contact your insurance agent and find out how much you’d save by choosing a PIP limit.  We don’t all pay the same for PIP:  it depends on who we are, what we drive, how we drive, etc.  Once you have this info, have a GOOD discussion with your agent about making a change.  By the way, I’m keeping Unlimited PIP.