What are state minimums for car insurance in Michigan?

Michigan requires a minimum of 20/40/10 of bodily injury and property damage coverage. The average rate of auto insurance is about $66.27/mo.

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Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates. He has also been featured on sites like UpJourney.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Apr 20, 2020

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Things to remember...

  • Michigan drivers face up to one year in jail for driving without insurance
  • Michigan drivers without insurance face license suspension that’s not lifted until you prove you have insurance
  • Drivers must have full coverage if you finance or lease your vehicle in Michigan


Michigan drivers must carry automobile insurance. It’s vital to the financial safety of all drivers, and it’s often the only thing that prevents at-fault drivers from financial ruin.

Carrying insurance on your vehicle protects you if you are involved in an accident if you are injured, and even if someone in your car is killed as a result of an accident.

Insurance can cover the cost of your medical bills, lost wages, and funeral and burial expenses. It’s there to cover the cost of car repairs to get you back on the road.

Your insurance policy is not just another expense you are required to pay every month. It’s one of the most important forms of protection you have behind the wheel of a car, which is why finding a policy that fits your needs is imperative as well as a legal requirement.

Understanding the type of coverage you need and how to find the most affordable policy makes shopping for car insurance that much simpler for Michigan Residents. Use our free insurance comparison tool above to make sure you are getting the best rate!

What are the minimum insurance requirements in Michigan?

Michigan lawmakers want all drivers in Michigan to carry liability insurance in specific amounts. You must carry bodily injury coverage of at least $20,000 per person and $40,000 per accident.

You must also carry property damage coverage worth $10,000. You must also carry Personal Injury Protection (PIP) insurance to help you cover costs if you are injured in an accident.

This is just the minimum, and everyone must carry at least this kind of policy. If you don’t live in Michigan, you needn’t abide by state insurance requirements. You must, however, abide by insurance coverage laws in the state where you reside.

Anyone who moves to Michigan has 30 days from the date you move into your home to change your insurance policy.

While Michigan insurance agents are required to provide you with quotes for at least the minimum amount, you shouldn’t go into an insurance office without knowing what’s expected, what you need, and how you can find the best rates for insurance.

If you’re a new resident, you should educate yourself on Michigan insurance requirements. It’s too expensive to ignore this law.

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Do I need insurance if my car is paid off?

Before you go out and change your policy to meet only the minimum requirements for car insurance, you should know how to handle a paid-off car. Most people pay car loans for at least 5 years on a brand-new vehicle, and depreciation is typically extensive.

Your car is not worth nearly what it was worth when you purchased it, which means you don’t always need full coverage.

While you might not need full coverage, you must have at least the minimum. Even if your car is not worth very much because of its age, it must be insured. Any car with active registration must carry insurance, and this is true of any car you’ve paid off.

Anyone who makes the mistake of assuming they can cancel their policy when their car is paid off is subject to fines and penalties.

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Car insurance Minimums and Leased and/or Financed Vehicles

There are additional requirements for anyone who leases or finances a vehicle. A leased vehicle is a vehicle you essentially borrow from a car dealership for a pre-determined timeframe.

The average lease is anywhere from two to three years, which means you pay a payment to the lender during this time and turn the car in after you make the last payment. You get a new car to lease at this point, which means you never own your car.

If you finance a car, it simply means a bank or other financial institution lends you the money you need to purchase the car if you can’t afford to pay cash.

The lender then comes up with an agreement you must sign to repay the loan in the agreed upon time. Once you make the last payment, the car is officially yours.

When you lease or finance your car, you must carry full coverage until your car is paid off. If you do not carry full coverage, your lender sends you a notice requiring you get a policy in place immediately. If you fail to purchase full coverage insurance for your vehicle, your lender can do it for you.

You are required to pay the premiums, and they’re almost always more expensive from the lender than they are if you shop for your policy.

What are the penalties for driving without insurance in Michigan?

Driving without insurance is illegal, and law enforcement officers do not issue a warning for this crime.

You aren’t pulled over and given a lecture to purchase a policy. You are given a ticket, you are charged fines, and you are penalized.

The act of driving without insurance in Michigan is a misdemeanor crime punishable to the full extent of the law.

Fines range from $200 to $500 if you haven’t insurance. First-time offenders are usually given a $200 fine, and the fine increases each additional time you’re caught. Your license is automatically suspended for 30 days, and you cannot get it back without proving you purchased an insurance policy. You must also pay local reinstatement fees to get it back.

Most first-time offenders are not sentenced to jail for driving without insurance. However, if you’re caught more than once, a judge might determine you pay a fine and spend up to a year in jail.

You might also avoid a fine but spend up to a year in jail if that’s what a court of law decides when hearing your case. It’s too expensive to drive without insurance in Michigan.

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What should I do to ensure I get good insurance quotes in Michigan?

Being sentenced to any time in jail means you now have a criminal record, which can affect your ability to find a job and/or support your family. It’s too expensive to drive without insurance, and it’s too affordable to put it off any longer.

Before you shop for a new policy, check your credit report to see if there are any mistakes in need of correction. The higher your score is the more likely you are to get a good insurance rate.

Discounts for retired drivers, drivers with more than one car on your policy, and drivers who live in a safe neighborhood are available with many companies.

Ask around for different discounts to see what kind of rates you can get with different companies. You can find affordable insurance; you must compare rates and know what you need to get a good rate. Use our FREE insurance comparison tool below! Just enter your ZIP and compare rates now!

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