What is Property Protection Insurance (PPI) for Auto Insurance?

Last Updated on December 17, 2022

Property protection insurance (PPI) is a type of liability coverage exclusively for drivers in Michigan.

Michigan requires drivers to have property protection insurance. It provides up to $1 million of property damage protection. If you damage another Michigan resident’s property, then PPI could cover this damage. 

You can exclusively buy PPI through insurance companies in Michigan, and it’s not available in any other state. 

Today, we’re explaining everything you need to know about property protection insurance (PPI) for auto insurance, including how property protection insurance works in Michigan.

What is Property Protection Insurance?

Property protection insurance, also abbreviated as PPI, is a type of no-fault liability insurance coverage required for car owners in Michigan.

PPI provides up to $1 million in property damage coverage in certain situations. If you accidentally damage another Michigan resident’s property, then PPI coves the cost of repairing this damage or replacing the property.

Drivers in Michigan must buy property protection insurance to obtain a license plate. If you buy car insurance in Michigan, then it automatically includes PPI coverage. Or, if you’re an on-out-state driver in Michigan, then your car insurance rises to match Michigan’s minimum required insurance limits, giving you property protection insurance coverage when driving in the state.

What Does Property Protection Insurance Cover?

Property protection insurance covers certain damage you cause to another person’s property when driving. If you hit someone else’s vehicle in a parking lot, for example, then property protection insurance should cover the cost of repairing that damage. Property protection insurance also covers other property owned by another person, including buildings, fences, trash cans, street lights, and other items you might hit while driving.

Some of the items covered by property protection insurance in Michigan include:

• Parked vehicles
• Buildings
• Fences and poles
• Mailboxes
• Streetlights
• Trash cans

How Does Property Protection Insurance Work?

Property protection insurance is a type of no-fault insurance coverage. Michigan is the only state that requires property protection insurance.

Michigan is one of 12 states considered a no-fault state for car insurance. Because Michigan is a no-fault state, insurance companies pay certain damage in all accidents – regardless of fault. If you’re involved in an accident and the accident wasn’t your fault, then your insurance company may still pay for certain costs up to your coverage limits, regardless of fault. 

Most other states require property damage liability coverage, which works similarly to property protection insurance. Michigan is the only state that requires property damage liability coverage and property protection insurance.

Minimum Car Insurance Requirements in Michigan

Michigan has some of the highest car insurance premiums in the United States. They also have some of the most extensive car insurance requirements.

Drivers in Michigan must carry all of the following coverages:

• $20,000 of bodily injury liability coverage per person
• $40,000 of bodily injury liability coverage per accident
• $10,000 of property damage liability coverage
• Property protection insurance (PPI)
• Personal injury protection (PIP)

Collision coverage and comprehensive coverage are optional in Michigan – just like they’re optional in all other states in America. These coverages protect your own vehicle after an accident. They also cover you against theft, vandalism, storm damage, fire damage, and other damage that occurs outside of an accident.

Property Damage Liability Coverage vs. Property Protection Insurance

Most states require drivers to have property damage liability coverage, which protects other drivers’ property against damage you cause. Michigan, however, is the only state where drivers must have property damage liability coverage and property protection insurance.

What’s the difference?

Property protection insurance protects you if you cause damage to a parked vehicle or fixed property. If you hit a vehicle in a parking lot, for example, then PPI could cover the cost of repairing this damage. Or, if you hit a neighbor’s fence while driving, then PPI covers it. 

Property damage liability coverage, meanwhile, covers all other types of property damage – not just parked vehicles and fixed objects. It also covers out-of-state accidents. 

Typically, if someone hits your vehicle on a road in Michigan, then you can only recover a maximum of $500 from the at-fault party. Otherwise, Michigan is a no-fault state, and you do not receive compensation from the at-fault driver.

If driving your vehicle outside of Michigan, then property damage liability coverage applies to all property damage.

Property Protection Insurance Exceptions: What Does PPI Not Cover?

Property protection insurance covers certain damages in certain situations. However, there are limitations to coverage.

Improperly Parked Vehicles: If you hit a vehicle that was improperly or illegally parked, then you may not be required to compensate the owner of that vehicle.

Damage Older than 1 Year: PPI has a one-year statute of limitations. 

Otherwise, property protection insurance covers most types of property damage in Michigan.

Can I Sue for a PPI Claim?

If your parked car or any other property was damaged by another driver, then the other driver’s insurance company is required to pay for this damage. 

Typically, the other insurer will cover your damage, and you deal directly with the other insurance company. 

However, if the other insurance company denies your claim, or if the other driver has no insurance, then you could sue for a PPI claim.

When suing for a PPI claim, you name the other driver’s insurance company as the defendant (not the other driver). 

If the other driver was uninsured, then you can name the driver or vehicle owner as the defendant in a PPI lawsuit. 

How to Get PPI Coverage in Michigan

All car insurance policies in Michigan include personal protection insurance (PPI) coverage. If you’re buying a car insurance policy from a registered insurance provider in Michigan, then your policy already has PPI coverage.

Compare quotes today by entering your ZIP code online. Although Michigan has notoriously high car insurance premiums, you can save money on PPI and other coverage by comparing quotes today. 

Final Word on Property Protection Insurance

Property protection insurance (PPI) is a type of no-fault insurance coverage only required (and only available) in Michigan. PPI covers certain damage you cause to another person’s property, including a parked vehicle, a fence, a pole, or other items.

If you buy a car insurance policy in Michigan, then that policy includes property protection insurance. It also includes property damage liability coverage, which is also required in Michigan. Based on the accident, you might make a claim through your property damage liability coverage or property protection insurance.