OFIR’s Tips on Coordinating Auto and Health Policies

LANSING – When purchasing automobile insurance, many Michigan drivers will be offered a discount from their auto insurance company if they coordinate their auto policy with their health coverage and wage loss or disability coverage. Michigan’s no-fault law requires auto insurers to offer a discount on the personal injury protection portion of the premium if you coordinate health or disability benefits with your no-fault auto policy.

The Office of Financial and Insurance Regulation (OFIR) today encouraged consumers to make sure their health coverage and disability or wage loss coverage will provide benefits for an auto-related injury. Under Michigan law, all health insurance policies must allow for the coordination of benefits, but Medicare, Medicaid and self-funded or self-insured health care plans are exempt from this coordination requirement.

If you have an auto accident and coordinated your health coverage with your personal injury protection coverage, your no-fault policy pays only for that part of your lost wages and medical expenses not paid by your disability or health coverage. Because your auto insurer would pay less in claims, your auto insurance cost is discounted.

“Before coordinating benefits, Michigan drivers need to carefully review their health coverage to determine that it will provide benefits in an auto accident, otherwise they may end up costing themselves their hard-earned money with a higher deductible,” said Commissioner Kevin Clinton.

OFIR receives hundreds of calls each year from consumers who incorrectly presume that their health care coverage would pay for their injury if they are in an auto-related accident.

Self-funded plans pay benefits from a fund established by an employer or organization. They are not insurance plans and therefore these contracts do not come under the authority of OFIR.

For more information on the coordination of benefits, consumers can read OFIR’s Guide to No-Fault Automobile Insurance or call the agency’s toll-free consumer hotline at 877-999-6442.