Penalties for Driving Without Insurance in Michigan

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Driving without car insurance in the state of Michigan is dangerous on many levels. Fees and surcharges can be charged against you by both the state and your future car insurance provider. And even worse, you will be held personally liable in the event of a car accident.

Michigan Secretary of State Penalties

The driver responsibility fee, $200 for two consecutive years, for not providing proof of current car insurance coverage was eliminated on October 1, 2012, in Michigan. The elimination of the fee is a huge saving if you are ever caught without car insurance. But, if you are caught driving without car insurance, you may suffer one or more of the following penalties:

  • Your license could be suspended.
  • Your license plate will not be renewed, transferred, or replaced.
  • $50 fine and potentially some other fees required by law.
  • Your license plate could be canceled.

Michigan Insurance Provider Penalties

Michigan's no-fault insurance laws require all licensed drivers to carry their state minimum limits. Car insurance providers want proof of prior insurance before they will write you a new car insurance policy. Failure to provide proof can result in drastically higher insurance rates.

  • High-risk driver rates for six months
  • Denied coverage from preferred carriers

So not only do preferred carriers blacklist you for six months but, if you were caught by law enforcement driving without car insurance, they can surcharge you sometimes up to three years. Many preferred car insurance carriers treat being caught by law enforcement without insurance the same as a speeding ticket.

At-Fault Car Accidents With No Car Insurance

A car accident with no car insurance in Michigan can result in triple penalties. You will face the penalties from the Secretary of State, your future insurance provider, and be held personally responsible for the injured party’s pain and suffering.

Michigan being a no-fault state means the most you will have to pay for car repairs for the other party is $1000 only if they do not carry collision coverage or do not have broad collision. Any property damage caused by you, including hitting a parked car, means you will be held personally responsible for all damages.

High Cost of Michigan Car Insurance

The cost of car insurance in the state of Michigan can seem like too much to bear. Michigan is often the state ranked highest for the cost of insurance. The reason is that Michigan is the only state which requires all drivers to carry unlimited medical coverage on their policy called the MCCA Fee.

The money required to fund this coverage is staggering. It is not a great state to reside if you are looking for cheap car insurance but it is a wonderful coverage if you ever need it.

The cost of going without car insurance can far, far outweigh keeping an insurance policy in force at all times. Car insurance should be one of your highest priority bills. It probably does not outweigh food and shelter, but it should come before cable and cell phones. Make car insurance a permanent part of your budget and look for ways to save money to make it affordable for your family.

The information contained in this article is not tax or legal advice and is not a substitute for such advice. State and federal laws change frequently, and the information in this article may not reflect your own state’s laws or the most recent changes to the law. For current tax or legal advice, please consult with an accountant or an attorney.