Unfortunately, I believe that many people have been misinformed by their insurance agent or company about the actual coverage offered by their policy. I believe that this is largely due to changes in the law that allow people to opt into more limited forms of coverage,
We noticed that many people who selected more limited plans for their medical coverage—say, $50,000 or $100,000—did not understand how quickly that money gets spent in the course of medical treatment. Many people who purchased these more limited plans got into accidents and then found themselves having completely exhausted all of their coverage after a few months. If those people are at fault for their accident, then their only hope at that point is to pray that health insurance is going to cover some of the treatment they are receiving.
Another thing that we notice often is that people misunderstand uninsured and underinsured motorist coverage. Many people do have some form of uninsured and/or underinsured motorist coverage. However, some Michigan health insurance companies combine uninsured motorist coverage and underinsured motorist coverage as one policy addition, while others require you to buy each of them separately. I have encountered many clients who only had one or the other when they thought they had actually purchased both.
To explain the difference a little further, uninsured motorist coverage covers you when the person who hits you or is at fault for the accident has no insurance coverage at all available to them. Underinsured motorist coverage is where the person who hit you has a minimum policy that is unlikely to cover any serious medical costs, and you had decided in advance to purchase additional coverage to protect you should that situation occur.
It should also be noted that those two coverages aren’t mandatory in Michigan. Since they’re elective, you need to specifically ask your insurance provider about them and ask them to instate them for you.
I also see people with some degree of confusion about bodily injury limits after the 2019/2020 law change. It used to be that claimants had a limit of $20,000. Now the limit is $250,000 unless you execute a waiver or meet certain conditions that would allow you to elect coverage of $50,000.
While that may be prudent for an older individual who doesn’t drive a lot, or someone who is a snowbird and flies Florida for 6 months out of the year and really don’t use their vehicle a lot, that protection may cover them. But, for most people, that is a very low limit and they are exposing themselves to be on the hook for a significant amount of money if they are ever at fault for an accident that causes significant injuries.
Just as I see people confused about their auto insurance, I also see people confused about their health insurance. Auto carriers will offer you the ability to coordinate your auto policy with your health insurance policy in exchange for a discount. However, coordination may not be to your advantage in certain situations, like if there are many restrictions on your health insurance plan.
For example, let’s take the process of seeing a specialist. In order to see a specialist, some HMOs require you to see your PCP first, and if your PCP writes you a script or referral to see a specialist, then and only then can you see the specialist. It is also noteworthy that many of these HMOs also have smaller networks, meaning your selection of doctors will be much more limited. With a PIP plan, you have more flexibility and more availability of medical treatment in certain circumstances.
Additional Information On Changes To Insurance Related Laws In Michigan
It’s important to address the issue of attendant care here. In Michigan, there’s something called attendant care for those who are significantly injured and require personal care, whether it’s from a traumatic brain injury, extended recovery after surgery, mobility issues, and many other scenarios. Regardless of the injury type, attendant care is care of a personal nature: help with ambulating, help with bathing, dressing, grooming, eating, and taking their medication/treatments. Again, these are typically seen when someone has had surgery after an accident, had to amputate a limb or extremities, or had a traumatic brain injury.
Under the old law individuals could receive 24/7 attendant care from a family member. There was a change to the attendant care law that made it so that if your family members are providing those types of services, they are limited to 8 hours of covered care a day.
This puts people who require more than 8 hours a day of personal care in a tricky position, providing that they want their family members to care for them. If they don’t want their family members to care for them and they want or need someone that has some medical credentials (like a skilled nurse or an LPN), there are a lot of home health care companies that can provide that service. Unfortunately, though—in large part because of the changes in the law—a lot of those companies are struggling to continue to operate.
Obviously, if an injured individual needs less than 8 hours of care, then they’re free to have their family members provide those services and the insurance company will pay as long as it’s properly documented. But if they need more than that 8 hours, it can be tricky to find a balance between having your family members provide the service and having a company provide any additional service above the 8 hours.
It’s certainly recommended that you discuss those issues with an attorney, so that you can help plan the appropriate care plan that will allow your family member who needs attendant care services to receive those services.
For more information on Limits On Auto-Insurance Policies in Michigan, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (248) 266-7600 today.