Michigan No-Fault Auto Insurance Death Benefits:
If car accident results in death, dependents of the deceased are entitled to recover “survivor loss benefits” and funeral and burial expenses under the Michigan No-Fault Act. Survivor’s loss benefits are payable for a period of three years and are limited to the same maximum monthly benefit applicable to work loss benefit.
In Michigan, a survivor’s loss benefit is made up of several components, which include after-tax wage income, lost fringe benefits, and replacement service expenses. The person the survivor’s loss benefits are payable to the following under the language of the statute:
“loss … of contributions of tangible things of economic value … that dependents of the deceased … would have received for support during their dependency … if the deceased had not suffered the accidental bodily injury causing death and expenses, not exceeding $20 per day, reasonably incurred by these dependents during their dependency … in obtaining ordinary and necessary services in lieu of those that the deceased would have performed for their benefit if the deceased had not suffered the injury causing death.”
The following are some important legal principles applicable to survivor’s loss benefits.
Auto Related Survivor Loss Benefit has Multiple Elements To The Claim:
Michigan Courts have held that the survivor’s loss benefit consist of and may include compensation for several important and distinct types of losses the deceased’s survivor(s) may suffer, including:
> the after-tax income earned by the decedent.
> the value of fringe benefits that were available to the decedent and his/her family but are now lost or reduced because of his/her death.
> any other activity that resulted in the economic value “contributions of tangible things of economic value” (e.g., exchanging services with neighbors).
> Replacement service expense benefit of $20 per day payable for value of the household services the deceased would have performed for the benefit of the family.
Michigan Courts have also held that the survivor benefit of a person killed cannot be reduced by amounts attributable to the personal consumption of the deceased. See Miller v State Farm Mut Auto Ins Co, 410 Mich 538 (1981).
Monthly Survivor Loss Benefit is Capped By Law:
Unlike normal auto injury claims that does not involve death, where the injured claimant can obtain work-loss benefits up to the monthly statutory maximum, plus a separate payment of $20 per day for routine household replacement service benefit reimbursement, all elements of survivor’s loss benefit claim is capped by the monthly statutory maximum limitation, which included the replacement service component. Therefore, the total of all components of the survivor’s loss claim cannot exceed the monthly maximum cap applicable to no-fault work loss benefits.
The Department of Insurance and Financial Services (DIFS) issues an annual bulletin stating the maximum amount that may be paid per month for survivor’s loss benefits. The most recent DFIS bulletin indicates the maximum is $5,755 per single monthly period, effective October 1, 2020 – September 30, 2021.
Who Is Eligible For Survivor Loss Benefits:
The No Fault Insurance Law allows only those persons who are classified as a “dependent” of the deceased to make a claim for survivor loss benefits. The No-Fault Act states that spouses and children under 18 are conclusively presumed to be dependents of the deceased.
In addition, children over the age 18, but physically or mentally incapacitated from earning income, are also considered a dependent of a parent with whom the child lives or from whom the child was receiving regular support at the time of his/her parent’s death. The law also considers children dependent’s if the child over the age of 18 is engaged “full-time in a formal program of academic or vocational education or training.”
In all other cases, qualification for “dependent” and the extent of dependency are to be determined on a cases by case basis as the facts exist at the time of death. The No-Fault Act also states that the surviving spouse dependency ends upon death or remarriage of the surviving spouse.
Auto Accident Related Funeral And Burial Expenses
Under Michigan law every auto insurance policy must provided for funeral and burial expense benefit. Subsection 3107(1)(a) provides “funeral and burial expense” benefit “shall not” be less than $1,750 or more than $5,000, depending on the type of coverage the accident victim was carrying at the time of the accident. These benefits apply to the charges of a funeral home, gravesite, and related burial expenses.
Accidental Death Benefit Coverage
Michigan’s no fault law does not require the an auto insurance company to sell any “accidental death benefit” coverage, but many auto insurance policies have accidental death benefit coverage. This can be a significant source of compensation. The insurance company has agreed to pay a fixed amount upon the accidental death of a driver or occupant of the insured auto. A trained auto accident insurance attorney can review the policy language and coverages to make sure you don’t miss any benefits available to you or your family.