Michigan’s Auto Insurance Law Has Changed
The information contained in the following publication pertains to auto
insurance policies issued on or before July 1, 2020. Publications about auto
insurance policies issued on or after July 2, 2020 are available at
michigan.gov/autoinsurance.
For more information about the new auto insurance law and how it will affect
you, please visit: www.michigan.gov/AutoInsurance.
Consumer Counselor
Insurance Information for Michigan Consumers
[FIS-PUB 0204] Michigan Department of Insurance and Financial Services | 877-999-6442 | www.Michigan.gov/DIFS [11/19]
Auto Insurance: Are You Eligible?
A Michigan insurance law called the Essential
Insurance Act guarantees that auto and home
insurance will be available to all eligible
Michigan citizens. The law says that you are
eligible for auto insurance if you have a car
registered, or to be registered, in Michigan OR
have a valid Michigan driver’s license.
However, there are times when a company can
refuse to insure you.
Reasons for Denial
You can be turned down for insurance if:
1. You are not required by law to have no-fault
insurance because you do not intend to live
or drive in Michigan for 30 or more days.
2. Within the past 5 years, you have been
convicted of trying to defraud an insurance
company, or have been denied payment of
a claim over $1,000 because there is
evidence of fraud on your part.
3. Within the past 3 years, you have been
found guilty of a felony with a motor vehicle,
driving under the influence of alcohol or
drugs, failing to stop at the scene of an
accident, or reckless driving.
4. The car you want to insure does not meet
Michigan motor vehicle safety requirements.
5. Within the past 2 years, your auto insurance
has been canceled because of non-
payment of premium. This can be
overlooked if you pay your entire premium
in advance.
6. The insurance you want to buy requires you
to be a member of a group, club or
organization and you do not join the
organization.
7. Your driving record causes you to have
more than the allowable number of eligibility
points.
8. You do not meet the requirements of a
company’s underwriting rules.
9. Your license to operate a vehicle is under
suspension or revocation.
Your Driving Record Makes a Difference
Insurance companies will assign you insurance
eligibility points for certain traffic violations and
accidents. THESE POINTS ARE NOT THE
SAME AS THOSE ON YOUR OFFICIAL
DRIVING RECORD, but are simply a guide to
help the company decide whether you are
eligible for auto insurance. The chart on the
next page shows how insurance eligibility points
are assigned.
You can be denied insurance if you have more
than six (6) eligibility points from violations
within the past 3 years.
Company Guidelines
Insurance companies also use certain
guidelines, called underwriting rules, to help
decide whether they will insure you. These
rules may be different for each company, but
each company must apply its rules in the same
way to everyone. For example, a company
may refuse to insure you if it does not have a
rate for your type of car, if your car is very
expensive to repair or replace (such as custom
or antique cars).
[FIS-PUB 0204] Michigan Department of Insurance and Financial Services | 877-999-6442 | www.Michigan.gov/DIFS [11/19]
Most drivers in Michigan will be able to get
insurance under the Essential Insurance Act. If
you are unable to find insurance through a
regular company, or can only find it at an
extremely high price, you may want to ask your
agent to apply to the Michigan Automobile
Insurance Placement Facility. The facility was
created to offer insurance to persons who have
difficulty finding coverage through regular
companies. IF YOU ASK, AND ARE
QUALIFIED, YOUR AGENT MUST SUBMIT
AN APPLICATION TO THE FACILITY FOR
YOU.
If a Company Refuses to Insure You
1. You are entitled to a written explanation of
the reasons for the refusal.
2. If you think the reasons are incorrect, you
are entitled to a private, informal conference
with a management representative of the
company.
3. If, after this conference, you are still not
satisfied, you can request the matter be
reviewed by the Department of Insurance
and Financial Services (DIFS). DIFS is the
state department that regulates insurance in
Michigan.
If You Are Eligible
1. Shop around for the best combination of
price, coverage and service. If the company
or agent you go to doesn’t offer you the
insurance you want or need, go somewhere
else.
2. Your agent should provide you a premium
quote from among the companies he or she
represents. You may also want to ask about
the rate charged by the Michigan
Automobile Insurance Placement Facility.
Insurance Eligibility Points
Violation Points Assigned
Driving more than 15 mph over the speed limit (careless driving) .............................. 4
Driving 11-15 mph over the speed limit ...................................................................... 3
Driving 10 mph or less over the speed limit ................................................................ 2
Driving 15 mph or less over the speed limit on freeways which used to have a
Maximum speed of 70 mph .................................................................................... 2
Other moving violations ............................................................................................. 2
The first accident in which you are more than 50% at fault ........................................ 3
The second and all following accidents in which you are more than 50% at fault ....... 4
How to Get More Information
If you have questions about your auto insurance, contact the agent or company. If they cannot
answer your questions, contact DIFS at the address or telephone number below.
[FIS-PUB 0204] Michigan Department of Insurance and Financial Services | 877-999-6442 | www.Michigan.gov/DIFS [11/19]
About DIFS
The mission of the Michigan Department of Insurance and Financial Services is to ensure access to
safe and secure insurance and financial services fundamental for the opportunity, security and success
of Michigan residents, while fostering economic growth and sustainability in both industries. In addition,
the Department provides consumer protection, outreach, and financial literacy and education services
to Michigan citizens. For more information please contact DIFS at 877-999-6442 or visit
www.michigan.gov/DIFS.
