Liability insurance is required in every state and provides coverage if you’re at fault in an accident that causes injury or property damage to others. It includes both bodily injury liability and property damage liability. Bodily injury liability helps pay for the medical bills, rehabilitation costs, and lost wages of other people involved in an accident you cause, while property damage liability covers the repair or replacement of another person’s vehicle or property. For instance, in Michigan, you must carry at least 50/100/10 (As of February 2026).

Michigan and the other 11 states follow a no-fault insurance system, which means your own insurance covers medical expenses and related costs regardless of who caused the accident. Personal Injury Protection, or PIP, helps pay for medical treatment, rehabilitation, and lost wages for you and your passengers after an accident. Property Protection Insurance, or PPI, covers up to $1 million for damage your vehicle causes to another person’s property within the state, such as a parked car, building, or fence. These coverages are required in Michigan and offer valuable financial protection in case of injuries or property damage.

Uninsured and underinsured motorist coverage provides crucial protection if you’re involved in an accident with a driver who has little or no insurance. While it’s not mandatory everywhere, it is required in about 20 states and Washington, D.C., and strongly recommended in others. This coverage helps pay for your medical expenses, lost income, and vehicle repairs if the at-fault driver can’t fully compensate you for the damages. With the rising cost of repairs and healthcare, uninsured motorist coverage ensures you remain protected even when other drivers aren’t properly insured.