State Minimum No Fault B.I. Coverage Applicable Only if Insurer Follows the Rules
Marilyn McDougall and her husband, Larimore McDougall, were killed in an automobile accident. The Estate of Marilyn McDougle filed an auto negligence claim against the Estate of Larimore McDougle. The couple had a no-fault auto insurance policy with MemberSelect Insurance Company. The policy provided bodily-injury liability limits of $250,000per person/$500,000 per accident. Both Larimore and Marilyn were named insureds on the policy. The couple never signed any form electing lower coverage. The policy included a “step-down” provision reducing coverage for bodily injury to the state minimum if the claimant was an insured or resident relative. The claimant in this case was both. MemberSelect sought to reduce the available coverage to Michigan $50,000 minimum.
The 2019 amendments to Michigan’s no-fault law permits an individual to elect auto liability coverage lower than the default amount of $250,000.00 if the election for lower coverage was made by an approved form. See: MCL 500.3009(5). MemberSelect, the Plaintiff in this case, argued that its policy was entitled to be enforced as written. It further argued that the minimum limit mandated by the 2019 amendments Michigan law was $50,000.00.
The Trial Court rejected MembeSelect’s arguments finding that opting for $50,000.00 coverage can only be done by completing the approved form electing that minimum coverage. The Court of Appeals agreed with the Trial Court. The Court of Appeals stated that the “statutorily required minimum residual liability insurance for policies issued after July 1, 2020 is $250,000.00 per person/500,000.00 per accident, pursuant to MCL 500.3009(1)(a) and (b), unless the proper steps are followed to exercise the option of selecting a lower coverage amount…”
Step down provisions in auto liability policies, standing alone, are unenforceable. Only if an insured completes the approved form, in the approved manner, can coverage be reduced from the default amount of $250,000.00. See: MCL 500.3009(5) and (7); MCL 500.3107e.
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MemberSelect Ins Co vs Linda Partipilo
About Alexander & Angelas, P.C.
Attorney Peter A. Angelas represents defendants in civil liability litigation across Michigan and Northern Ohio. His practice areas include insurance defense litigation, premises liability, motor carrier (trucking) defense, corporate and commercial litigation, construction defect litigation, auto negligence, insurance coverage disputes, emergency casualty response services, alternative dispute resolution, subrogation claims, workers’ compensation, employment law, and liquor liability.
Mr. Angelas practices in all state and federal courts in Michigan, including Wayne County (Detroit), Macomb County (Mount Clemens), Oakland County (Pontiac), Washtenaw County (Ann Arbor), and Genesee County (Flint). Legal services are also provided in Northern Ohio.
A 24/7 Emergency Hotline is available (800-219-0007) for trucking and insurance company clients. When an accident requires an immediate response to protect evidence, members of the firm quickly launch an investigation with the assistance of well-qualified accident investigators, crash re-constructionists, mechanical engineers, civil evidence photographers, and independent adjusters positioned throughout Michigan and Northern Ohio.
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