Property Protection Insurance VS Property Damage Insurance

What to do when property is damaged in a car accident and what coverage pays

There are important differences between property protection insurance vs property damage coverage. Your PPI pays when you damage a safely parked car, a tree or a fence in Michigan – regardless of whether you were at-fault. PD pays when you cause an out-of-state crash that damages another person’s vehicle.

What is property damage in car insurance in Michigan?

In Michigan, property damage insurance is the car insurance coverage that drivers are required to carry under the No-Fault law which helps them cover their liability for vehicle damage repair costs resulting from an out-of-state car accident they caused.

For instance, if you were driving in Ohio and you were at fault for damaging someone else’s car, you would be legally liable to pay to repair the damages to the other person’s car. Your property damage car insurance coverage under your Michigan No-Fault auto policy that you have on your own vehicle will help you pay what you owe.

Under Michigan law, every driver must maintain at least $10,000 property damage car insurance coverage that can be applied to damages arising from an out-of-state car accident caused by the driver. (MCL 500.3101(1); 500.3131(1); 500.3009(1)(c))

It is important to remember that property damage car insurance coverage does not apply to vehicle damages arising from a crash that a Michigan driver causes within the State of Michigan. When this happens, the owner of the damaged vehicle has three options for getting his or her damage repair costs paid:

• File a claim under his or her own collision insurance policy
• File a mini tort lawsuit in small claims court against the at-fault driver for damages up to $3,000 (that are not or could not be covered by collision insurance)
• Pay out-of-pocket for the vehicle damage repairs

CAUTION: $10,000 of property damage car insurance coverage, which is the minimum, is really inadequate.  For instance, if you are driving outside of Michigan and you are responsible for totaling someone’s $50,000 car, your property damage car insurance coverage would pay the first $10,000 of damage, but then you would be on the hook for the remaining $40,000.  For this reason, we recommend carrying a minimum of $100,000 of propery damage car insurance coverage, which is fairly inexpensive.

What is property protection insurance in Michigan?

In Michigan, the No-Fault Act requires all auto policies to carry Property Protection Insurance (PPI) coverage. This means if your car does damage to someone’s property in Michigan – such as a safely parked car, fence, tree – your insurer will pay for the damage through your PPI coverage. (MCL 500.3101(1)) and (MCL 500.3121(3) and (5))

Propertin protectin insurance coverage always has a $1 million policy limit. (MCL 500.3121(5))

Property protection insurance coverage is paid without regard to fault in an auto accident.  For instance, if you are waiting to make a left turn and another vehicle strikes you and pushes you into a telephone pole, both your insurance company and the insurance company of the wrongdoer will share equally in the cost to repair or replace the telephone pole.

Who do I sue for a property protection insurance claim?

In Michigan, the statute of limitations on a property protection insurance claim is one year. If your safely parked car or any other property is damaged by another driver, the actual responsible party is the insurer of the vehicle’s owner. If a claim cannot be made against the owner’s insurer, then the claim can be filed against the insurer of the person driving the vehicle at the time the property damage occurred. (MCL 500.3145(5)) and (MCL 500.3125)

If you are forced to file a lawsuit to enforce your property protection insurance claim, you must name the insurer as the Defendant.  If you fail to do so and instead name the driver and/or owner of the car as the defendants, and the one year statute of limitations expires, you will not be able to name the insurer to the lawsuit at a later date.

The only exception is if the car was uninsured. In that case, you must name the driver and or owner as defendant(s) in the property protection insurance lawsuit.

Did you have property damaged after a car accident? Call the attorneys at Michigan Auto Law now!

If you still have questions on the differences between property protection insurance vs property damage insurance and need help with a claim, call now at (888) 857-9250 for a free consultation with one of our experienced car accident lawyers. There is no cost or obligation. You can also visit our contact page or use the chat feature on our website.

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