Michigan has long been infamous for having some of the most expensive motor vehicle insurance in the country. Now, changes to the state’s law have taken effect that give people the option of purchasing less expensive insurance.

Drivers can now carry lower levels of Personal Injury Protection (PIP). Should you jump at the chance to reduce your insurance premiums?

Lower costs come with lower levels of coverage

The cost reduction for Michigan insurance isn’t just a goodwill effort. It reflects work by state lawmakers to reduce the mandatory coverage required by drivers in the state. Until this month, the no-fault insurance law in Michigan required that all drivers carry unlimited personal injury protection as part of their policy. Regardless of who caused the crash, a driver could rely on their own policy to cover all of their medical expenses.

Those with low income may qualify for reduced insurance requirements under the new law. For example, those on Medicaid may be able to carry as little as $50,000 in PIP, while others can select higher but still finite levels of coverage.

What are the risks of reducing your PIP coverage?

If you get hurt in a crash and you only carry minimal levels of PIP, you may be left with extensive medical costs. You may also be unable to work, meaning that your family will have to endure financial hardship. The less PIP coverage you have, the more you will pay out of pocket, especially if you don’t have health insurance.

Those who suffer injuries in crashes where there isn’t adequate insurance to cover their medical costs and other losses may need to explore alternative options for compensation, such as a personal injury lawsuit against the other driver involved.