Livonia Car Insurance

If you are a resident of Livonia, Michigan, it is very important to set aside time to familiarize yourself with the unique auto insurance laws that apply only to you and your fellow Michiganians.

Unlike a majority of the states in the country, Michigan operates under a no-fault system that was adopted in 1973.

According to the Department of Insurance and Financial Services, this no-fault system was adopted in an effort to make claims payments promptly, increase the benefits paid to injured victims, and reduce the cost associated with filing a claim.

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Read on, and learn more about the types of coverage you must carry and how to buy a comprehensive insurance policy in Livonia.

What are Livonia car insurance requirements?

In fault-based states, everyone who drives a motor vehicle must purchase Bodily Injury coverage to pay for treatment of injuries to a third-party and Property Damage cover to pay for repairs or replacement of someone else's property.

While Michigan is not a pure no-fault state, the officials have created laws that make the system as close to no-fault as possible while still allowing a platform for a competitive marketplace.

Every car owner must have certain basic coverages to register their vehicle in Michigan. These basic coverage options include Personal Injury Protection, Property Protection, and Residual Liability Insurance.

If you are coming from another state, the names of these coverages may be foreign to you. Here is a straightforward description of each basic coverage requirement along with the minimum limits you must hold:

Personal Injury Protection (PIP)

One of the major differences between insurance in a no-fault state and insurance in a fault-based state is that you must carry Personal Injury Protection under the no-fault law.

PIP provides you and your passengers with medical and rehabilitation benefits with no limit. This is one of the major ways that no-fault cover in Livonia and other cities in Michigan differs from no fault cover that is required in the other 11 states in the country.

In addition to paying your medical costs, PIP cover will pay up to 85% of your lost income and up to $20 per day for replacement services no matter who is found at-fault for the loss.

In exchange for the unlimited medical benefits and rehabilitation benefits, you sign away your right to sue for damages. You can sue, however, if someone is killed or permanently injured in the crash. This is why residual liability cover is also required.

Property Protection (PPI)

Property Protection cover pays for damage that your car does while being operated when the property damaged is located in Michigan.

In addition to paying for fences, residential homes, commercial properties and lampposts, PPI will pay to repair a car or replace it if it is damaged while it is parked in a legal parking spot.

Any other vehicle that is damaged is excluded from coverage. The PPI coverage requirement is $1 million.

Residual Liability

While the system does not typically use fault to determine who will pay for damages, there are cases where a victim in an accident has the right to sue you for payment.

You will have to be found at-fault for the loss to be held legally responsible. In most cases, only someone who suffered very serious injuries or someone in the vehicle with a passenger who died in a crash can sue to collect compensation for their economic losses.

They may be able to collect for the money that exceeds the benefits that were available to them.

Residual Liability is also necessary to protect you when you are driving outside of Michigan and you cause property damage or bodily injury.

When driving to a fault-based state, having these residual coverages is important to protect your assets and wages if you are negligent for a motor vehicle crash. This residual cover acts just like traditional third-party liability acts in other states. Here are the coverage limits that must be carried in Michigan:

• Bodily Injury - $20,000 per person, no less than $40,000 total per car accident
• Property Damage - $10,000 per car accident for property

You do have the option to purchase higher liability limits to protect your investments and assets. These higher limits provide you with more financial protection in Michigan when in a serious accident and outside of Michigan when in any kind of accident.

Are there additional types of coverage available in Livonia?

A no-fault insurance policy may cover your entire Livonian household, but it does not protect you against everything. Have you ever wondered what would happen to your car if it was damaged in a covered accident?

Unless your car was parked legally and damaged by a Michigander, the damages will not be covered unless you purchase physical damage protection on your own. This is another way that the Michigan insurance system differs from others.

• Physical Damage

If you want your vehicle damage to be covered, you need more than just a basic no-fault plan. You will need to add Comprehensive and Collision cover to your car so that you can easily afford to get the vehicle repaired or replaced.

Physical Damage cover is not required, but it is important to have it when your vehicle is not owned.

Be aware that comprehensive pays for non-moving claims for losses like theft, fire, and vandalism, and collision pays for damages sustained in an accident that is either at-fault or not at fault.

• Uninsured Motorist

You can also purchase uninsured motorist protection, called UM, to help pay for exorbitant medical expenses and other bills if you are in a serious accident with a reckless driver who drives without cover.

Your PIP will pay, but UM will provide you with payment for expenses that exceed those that are covered. Considering the fact that Michigan is ranked as the state with the fifth highest rate of uninsured drivers, it is wise to consider this coverage.

After all, when 21 percent of drivers are not covered, this means that about 1 in 5 drivers in Livonia do not have coverage and are putting you directly at risk.

How to Find an Affordable Car Insurance Policy

Now that you understand the complex nature of Livonia car insurance and the Michigan no-fault car insurance laws, the next step is to learn how to build a policy that protects you and still falls into your budget range.

The key to building the best policy is to first understand how your rates are calculated by licensed Michigan car insurers. Once you understand this, you can move on to learning how to qualify for low rates.

How are Michigan car insurance rates calculated?

The insurance market is heavily regulated, and the Department of Insurance and Financial Services is responsible for reviewing applications and approving rates in order to protect consumers.

While all licensed providers have a right to set their own rates, these must be filed with the department and approved to ensure that they are as fair as possible. No insurer is allowed to communicate with another about their rates to hinder competition.

All insurers use a large set of factors to create a rate filing. These factors all use risk to determine which factors hold the most weight in affecting premiums.

The company will also use specific factors that they hold most valuable to set rates to target a specific type of driver or a specific demographic.

If the company prefers to cover college students over senior drivers, they will make rates for higher age groups higher but rates for younger operators lower.

Some of the various rating factors that can determine price are:

• Driving Record
• Accident History
• Years of Experience
• Age
• Gender
• Type of vehicle
• Purpose of driving
• Annual mileage
• Safety features of vehicle
• Territory where vehicle is parked
• Credit score

How can you find the best rate in Livonia?

The most effective way to find the best rate when you are shopping for coverage in Livonia is to comparison shop with companies that compete with one another.

Because companies offer a wide variety of rates that target different demographics, comparing quotes is the best way to see if you are getting the best prices at all times. Here are some tips to contemplate as you shop:

• Choose a company that is financially stable to avoid being denied for claims
• Find companies with positive complaint ratios so you do not receive poor service
• Find out how you can contact the company for questions or to submit changes

You should never put price before everything else when you are buying Livonia car insurance.

As you shop the market to find the best policy from a top-rated company, you should consider the facts first. To reduce the time it takes to compare rates, use an online quoting tool. Get all of your quotes at once and find your policy in just minutes.

Now that you've learned more about coverage, search for affordable car insurance rates from top companies!