Michigan Senate Approves Doubling Mini-Tort Limit

Senators in Michigan voted last week in support of a bill that doubles the limit up to which a motorist can sue for crash damages not covered by their own insurance.

The vote for HB 5362 increases the “mini-tort” limit from $500 to $1,000.

Mini-tort, an exception to the state’s no-fault insurance law, allows motorists who have their cars damaged by another driver in a crash to sue those other drivers for compensation of the deductible when the other drivers are clearly at fault for the accident. The no-fault insurance law dictates that motorists be compensated by their own insurer in crashes, regardless of who was at fault, and largely prohibits motorists from suing each other.

The unanimous vote last week follows unanimous approval from House Representatives on April 19 and finalizes the legislation within the state Congress. The act, which goes into effect on Oct. 1, got the support of several state trade groups during a state House committee hearing in March.

Courts assess mini-tort damages “on the basis of comparative fault,” according to the legislation, meaning a driver can sue for compensation of the deductible in crashes only where the other driver was more than 50 percent at fault. A driver who is partially at fault may recover a reduced amount of damages sought in court.

Mini-tort coverage is available to policyholders as an optional kind of coverage and is often called “limited property damage liability” by insurers. If drivers have it, they won’t have to pay for the other driver’s deductible out of pocket.

The legislation revises language to better define residual liability as a separate form of coverage that does not protect a motorist from mini-tort liability.

The legislation also specifically excludes uninsured motorists from those able to seek mini-tort damages.

The last increase to mini-tort was from $400 to $500 in 1995, according to a legislative analysis.

Those who need answers to auto insurance questions about Michigan’s mini-tort exception can refer to the state consumer guide on the topic.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

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