Michigan’s PIP System in 2025: Why It’s Now a “Pay-to-Play” System — and What Injured Drivers Need to Know

Michigan’s auto-insurance system was once known for providing automatic, unlimited PIP medical benefits to every driver, regardless of fault. But the 2019 amendments to the No-Fault Act fundamentally changed the system — and today, Michigan operates under what many attorneys call a “pay-to-play” model.

Under this system, your ability to receive medical benefits after an auto accident depends on whether you paid for a qualifying level of PIP medical coverage.
And if nobody in your priority chain purchased coverage — or the policy excludes you — you may be forced into the Michigan Assigned Claims Plan (MACP) with significantly lower limits.

This article explains how Michigan PIP works in 2025, how the priority rules changed, why “pay-to-play” is now the reality, and how injured Michiganders can still access medical benefits through the MACP when coverage is unavailable.

Michigan PIP Is Now a “Pay-to-Play” System

Before 2019:

• All auto insurance policies in Michigan carried unlimited PIP.
• Every resident injured in a crash (drivers, passengers, pedestrians, bicyclists) had access to unlimited medical benefits.
• Coverage did not depend on what the injured person’s household purchased.

After the reforms:

PIP medical coverage is now chosen by the policyholder

Options include:

• Unlimited
• $500,000
• $250,000
• $50,000 (Medicaid-qualified households)
• No PIP medical (Medicare-qualified households)

Access to PIP depends entirely on what you or a household member paid for

If the policy purchased:

• Unlimited → you have unlimited
• $250,000 → you only have $250,000
• Opt-out → you may have no PIP at all

This is the core change.
Michigan No-Fault used to be a universal safety net.
Now, it is a purchased benefit — if you didn’t buy it, you may not have it.

That’s why attorneys across the state describe the system as pay-to-play.

How the 2019 Amendments Changed Priority Rules

Michigan’s priority rules (who pays PIP first) changed significantly.
The old rule was simple: your own household’s auto insurer paid PIP — even if their car wasn’t involved.

The new priority structure under MCL 500.3114 narrows who qualifies for PIP through a household policy:

1. Named insureds

If you are the named insured on the policy → that policy pays.

2. Resident relatives

If you live with a relative who has a valid PIP policy → that policy may pay but only if you’re not excluded.

3. Occupants of the vehicle

If you do not have a household policy, but you were an occupant → you claim PIP from the insurer of the vehicle you were in.

4. MACP (Assigned Claims)

If no applicable policy exists, or exclusions apply → you must go to the Michigan Assigned Claims Plan.

Key change:

Many people who used to qualify for household PIP coverage no longer qualify because their relative opted for limited PIP, opted out, or specifically excluded them.

This leaves thousands of Michiganders without traditional PIP access after a crash — forcing them into the MACP.

What About Unlimited PIP? Can Drivers Still Get It?

Yes — unlimited PIP still exists in Michigan, but:

• Fewer companies offer it
• Many people cannot afford it
• Some households unknowingly reduce their coverage
• Drivers often don’t realize their PIP is capped until after a crash

Even if the at-fault driver has unlimited PIP, their policy does not provide medical benefits to you.
Only your own priority chain determines your PIP medical benefits.

This means:

Your coverage is only as strong as the PIP limit you paid for — not what the person who hit you purchased.

This is one of the most misunderstood issues in Michigan auto law today.

When No PIP Coverage Exists: The Michigan Assigned Claims Plan (MACP)

If no policy applies under the priority rules, Michigan residents may still qualify for limited benefits through the MACP, administered by the Michigan Auto Insurance Placement Facility (MAIPF).

Eligibility often applies when:

• You do not have auto insurance
• No resident relative has auto insurance
• You were excluded from coverage
• You were a pedestrian or bicyclist and no applicable policy exists
• You were a passenger in an uninsured or illegally insured vehicle
• You were driving a vehicle you did not insure

The MACP provides:

Up to $250,000 in PIP medical benefits

Replacement services

Some attendant care (limited)

Coordinated benefits (limited by statute)

It does not provide unlimited PIP.

Applications must be completed correctly or the MACP will deny the claim. Riders, passengers, pedestrians, and low-income families often depend on the MACP as their last resort for medical coverage.

“Where Do I File First?” Understanding Priority in Real Terms

Here is the simplified version most Michiganders never hear:

If you have a valid auto policy with PIP → file with your own insurer.

If someone in your household has PIP → you may file there (unless excluded).

If you were in someone else’s vehicle → file with that vehicle’s insurer.

If none of the above apply → you must apply with the MACP.

This is why Michigan’s system is now “pay-to-play”:

• If your household didn’t purchase PIP,
• And the vehicle you were in didn’t carry PIP,
• You’re limited to MACP benefits, no matter how serious your injuries.

How This Affects Auto Accident Cases and Insurance Disputes

Auto insurers now frequently:

• Deny PIP based on priority disputes
• Claim the injured person is “not eligible” under the household policy
• Assert exclusions or coordination provisions
• Delay or refuse payment because another insurer should pay
• Force injured drivers into MACP to reduce exposure
• Challenge residency, household relationships, and policy language

This is where legal experience matters.

A small error in a PIP application can:

• Delay treatment
• Create liens
• Trigger large out-of-pocket expenses
• Allow insurers to improperly reject claims

Most people simply cannot navigate these issues on their own.

If you are injured in a Michigan auto accident, both your PIP claim and your personal-injury (tort) claim must be preserved correctly from day one.

(← Here you can link this sentence to your Auto Accidents page.)

Insurance Disputes Are Increasing Under the New System

Post-reform, Michigan is seeing:

• More wrongful PIP denials
• More coordinated benefit disputes
• More “excluded driver” fights
• More residency challenges
• More MACP disputes
• More medical-necessity denials
• More priority litigation

Insurers now have financial incentives to avoid paying PIP, especially when households carry limited or no coverage.

This is one of the fastest-growing areas of litigation in Michigan.

(← Here you can link this paragraph to your Insurance Disputes page.)

If You’re Unsure About Your PIP Rights,
JKH Law Can Help

Michigan’s post-reform PIP system is complex — and in many cases, unfair.
Your access to medical benefits now depends on:

• What coverage your household purchased
• Who insured the striking vehicle
• How the priority rules apply
• Whether you qualify for MACP benefits
• Whether the insurer is correctly interpreting the statute

You don’t have to navigate this alone.

If you were injured in a Michigan auto crash and are facing PIP issues, denials, or MACP questions, I can help you understand your rights and protect your claim. Click to see more Auto Accidents information and Insurance Disputes information.