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- Every auto policy must include three basic coverages: personal injury protection (PIP), residual bodily‑injury/property‑damage liability (BI/PD) and property protection insurance (PPI).
- PPI covers accidental damage to “tangible property” arising out of the use of your vehicle, and it applies regardless of fault.
- PPI coverage is mandated by Michigan statute for all registered vehicles.
If you drive in Michigan, you’re required to carry certain auto insurance coverages under the state’s no‑fault system. One key piece is property protection insurance (PPI) — coverage that most drivers outside Michigan have never heard of.
Unlike standard liability insurance, PPI handles damage your car causes to stationary property or someone’s parked car within Michigan, regardless of who is at fault. Understanding how PPI works — what it covers, its limits and when other liability coverage kicks in — is vital to staying compliant and protecting your assets in the state of Michigan.
What is Property Protection Insurance (PPI) in Michigan?
PPI is a required element of your Michigan auto insurance policy that protects other people’s property when you’re responsible for an accident.
Under Michigan law, every auto policy must include three basic coverages: personal injury protection (PIP), residual bodily‑injury/property‑damage liability (BI/PD) and property protection insurance (PPI).
PPI covers accidental damage to “tangible property” arising out of the use of your vehicle — such as a parked car, a fence, a utility pole or a building — and it applies regardless of fault.
Because PPI is “no‑fault” for property damage in Michigan, you don’t have to wait to prove the other driver was at fault the way you would in many states. And this coverage is mandated by Michigan statute for all registered vehicles.
What kinds of property and scenarios does PPI cover?
PPI covers damage caused by your vehicle in Michigan to other people’s fixed property or parked vehicles — but not every scenario.
Typical examples include:
- Striking a properly parked car in a parking lot.
- Crashing into a fence, mailbox, lamppost or building façade.
- Hitting a tree, pole or fixed utility structure (only if the damage is not the result of a business or careless act).
PPI does not cover:
- Damage to another moving vehicle you hit (that falls under standard liability or collision).
- Property damage from accidents that occur outside Michigan.
- Damage to a parked vehicle that was parked illegally or in a way that posed an unreasonable risk of damage (an exclusion under MCL 500.3123(1)).
Understanding these boundaries helps drivers know when the PPI coverage applies — and when standard liability or PD coverage takes over.
What limits are required and how does PPI fit with liability coverage?
Michigan mandates a $1 million limit for PPI, and separate minimum limits apply for BI/PD liability.
For PPI: Michigan law sets a $1 million limit per accident for damage to tangible property under a single policy.
For other required coverages in Michigan:
- Bodily injury (BI) liability: Minimum of $50,000 per person, $100,000 per accident (though reforms allow higher/default numbers)
- Property damage (PD) liability: Minimum of $10,000 for damage to property in accidents outside Michigan.
It’s important to note that PPI handles damage inside Michigan to fixed/parked property; PD liability covers damage you cause to others’ vehicles when driving out of state or in other non‑PPI scenarios.
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When does PPI not apply, and when do you use liability coverage?
Knowing when your standard liability insurance, not PPI, is triggered can protect against coverage gaps.
PPI will not apply in the following situations:
- If you damage someone else’s moving car in Michigan and the coverage needed exceeds what PPI covers (or the scenario falls under PD liability).
- If the accident happens outside Michigan, then your property damage liability coverage is used.
- If the vehicle was parked in an unsafe or unreasonable manner, the damage is excluded under the statute.
- Cases involving utility transmission lines or cables may be excluded under certain business or municipal exceptions.
Because of these limitations, it’s wise to review your BI/PD liability coverage in addition to understanding your PPI coverage.
Filing a PPI claim and legal deadlines
The owner of the damaged property can file a PPI claim against the at‑fault vehicle’s insurer, but strict deadlines apply.
Under Michigan law:
- The statute of limitations for filing such a claim is one year from the accident.
- The claim should be made against the insurer of the driver or owner of the vehicle that caused the damage, not just the driver personally.
- Repair or replacement cost will be covered up to the lesser of actual repair cost or replacement cost less depreciation, plus any loss of use.
Drivers and property owners should document damage promptly and confirm which coverage (PPI or PD liability) applies.
Why it matters for drivers in Michigan
If you’re driving in Michigan, whether you live there or not, understanding PPI protects you and clarifies your liability.
Because PPI is required under Michigan’s no‑fault system, driving without appropriate coverage can expose you to criminal penalties, fines, or loss of benefits.
For out‑of‑state drivers, if you drive your vehicle in Michigan , your policy must satisfy Michigan’s minimums (including PPI) while you are operating there.
From a property‑owner’s side, if your parked car, fence or fixed structure is damaged by a vehicle in Michigan, the driver’s PPI coverage gives you a clear path to recovery.
Being aware of the limits and scope of coverage (parked car vs. moving car, in‑state vs. out‑of‑state, etc.) ensures you’re not caught off‑guard by a gap in protection.
Frequently Asked Questions: Michigan Property Protection Insurance
Is PPI the same as property damage liability insurance?
No — PPI is unique to Michigan and covers damage caused by your vehicle to fixed or parked property only in Michigan. Property damage liability (PD) covers damage to other vehicles or property in different contexts, especially outside Michigan.
Does PPI cover damage to my own car?
No — PPI covers damage you cause to someone else’s property (such as a parked car or fence) in Michigan. Your own damage is covered under collision or comprehensive, if purchased.
What happens if I damage a parked car in Michigan and the at‑fault driver is uninsured?
You would still pursue a claim under that driver’s auto insurer for PPI benefits. If no insurer exists, you may have to bring a lawsuit naming the driver or owner directly. The one‑year statute of limitations still applies.
Can I find PPI in other states?
No, this coverage is mandated only by Michigan law and is specific to its no‑fault auto insurance regime.
Final thoughts on PPI in Michigan
If you’re a Michigan driver (or driving a car registered in Michigan), it’s critical to understand property protection insurance.
Understanding what PPI covers (and what it doesn’t), how it works with other liability insurance (especially out‑of‑state), and how to handle claims can save you from legal and financial surprises. Review your policy today, ask your agent how your coverage handles parked car damage and fixed property and keep documentation in case you ever need to make a claim.
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