MCL 500.3111 & MCL 500.3163 - Out-Of-State Accidents & Out-Of-State Residents

Emily L. Partridge

The recent changes to the Michigan No-Fault Act have now changed how claims involving out-of-state accidents and out-of-state residents are handled. The changes seem to attempt to narrow entitlement to PIP benefits to Michigan residents only.

Out-Of-State Accidents

With respect to Michigan residents who are involved in a motor vehicle accident out-of-state or in Canada, either as an occupant or as a pedestrian, a named insured, his/her house, and any resident relatives are entitled to Michigan PIP benefits. However, if there was another occupant in the motor vehicle — such as a friend or Aunt Sally who lives in her own home — the other occupant is only entitled to Michigan PIP benefits if (1) they were a resident of Michigan or (2) if they had coverage under a PIP policy of their own.

Here are some hypothetical scenarios that may assist in the handling of claims:

Scenario 1: You, your spouse, your child, and your child’s best friend are driving to Florida when you are in an accident in your vehicle in Florida. If your child’s best friend is a resident of Michigan, the best friend would also be entitled to PIP benefits.

Scenario 2: You, your spouse, your child, and your child’s best friend are in Florida and, as pedestrians crossing the street to get to Disney World, are hit by a motor vehicle. You, your spouse, and your child are entitled to Michigan PIP benefits under MCL 500.3111. Your child’s best friend would be entitled to PIP benefits if they are a resident of Michigan and are domiciled with a relative who maintains a PIP policy. If your child’s best friend was a resident of Michigan but was not domiciled with a relative who maintained a PIP policy, your child’s best friend would not be entitled to Michigan PIP benefits. They could not collect PIP benefits under your policy since they were not an occupant of the motor vehicle, and they have no other policy to look to.

Scenario 3: Your child’s best friend is a resident of Ohio whom you picked up on your way to Florida. You are all involved in a motor vehicle accident while occupying your insured vehicle in Florida. It is not definitive what would happen since there is a contradiction in the plain language of MCL 500.3111 and MCL 500.3113(c). However, more likely than not, the child’s best friend would not be entitled to Michigan PIP benefits.

Scenario 4: Retired snowbirds whose primary residence is in Michigan own a motor vehicle insured with a Michigan PIP policy. The retired snowbirds are occupying this vehicle while in Florida and are involved in a motor vehicle accident. The snowbirds are entitled to Michigan PIP benefits under MCL 500.3111 and MCL 500.3113(c).

Out-Of-State Residents

Previously, MCL 500.3163 (a.k.a. the “roll on” provision) required 3163 certified insurers to pay Michigan PIP benefits to out-of-state residents who were involved in a motor vehicle accident in Michigan.

This section has been effectively repealed. Out-of-state residents who have an out-of-state auto policy are no longer entitled to unlimited Michigan PIP benefits simply because the motor vehicle accident occurred in Michigan.

The only exception to this new rule is if the out-of-state resident was the owner of a vehicle that was both registered in Michigan and insured with a Michigan auto policy. The common circumstances in which this exception may apply is if the claim involved a snowbird or college student.

Here are some hypothetical scenarios that may assist in the handling of claims:

Scenario 1: Retired snowbirds, whose primary residence is in Florida, but who also spend the summers here in Michigan, are involved in a motor vehicle accident in Michigan. They are entitled to PIP benefits only if they owned a motor vehicle which is registered in Michigan and insured with a Michigan auto policy under MCL 500.3163 and MCL 500.3113(c).

Scenario 2: Students from Michigan who go out-of-state for college and then become out-of-state residents may still own a motor vehicle that is registered in Michigan and insured with a Michigan auto policy. These individuals would be entitled to Michigan PIP benefits.