Car Accident While Working in Michigan: Who Pays?

You were making a delivery, driving to a client, or running an errand your boss asked for. Then someone ran a light. Now you're hurt, you can't work, and you have three different insurance answers: your employer's, your own auto insurer's, and the other driver's.

Michigan handles a crash on the job differently from an ordinary car accident. Two benefit systems can apply at the same time, workers' compensation and no-fault, and the law decides which one pays first. On top of that, you may have a claim against the driver who caused it. Getting the order right matters, because it affects how much you receive and how fast. If you were hurt while working, our personal injury practice can help you sort out who owes what.

Workers' comp usually pays first

When you're injured in a car accident that happens in the course of your job, workers' compensation generally applies, just as it would for an injury at a worksite.

Michigan's no-fault law then treats workers' comp as primary for overlapping benefits. Under MCL 500.3109, government-required benefits, including workers' comp, are subtracted from the personal protection insurance (PIP) benefits your auto insurer would otherwise pay. In practice:

• Workers' comp typically pays medical bills and a portion of lost wages first.
• No-fault PIP fills in benefits workers' comp doesn't cover, and can pay the difference where no-fault's benefit is higher.

Michigan courts have also said that an injured worker generally needs to make reasonable efforts to get the workers' comp benefits available before turning to no-fault for the same losses. That's one reason a delay on the comp side can hold up the whole claim.

How the wage benefits fit together

The two systems calculate lost wages differently, and the gap can matter.

• Workers' comp wage benefits are generally based on a percentage of your after-tax average weekly wage, up to a state maximum.
• No-fault wage loss is generally based on a percentage of your gross wages, up to a monthly cap, for up to three years.

Because the formulas aren't the same, no-fault may owe you the difference between what workers' comp pays and what no-fault would have paid on its own. Insurers don't always calculate that difference correctly, or volunteer it. Our post on lost wages after a Michigan car accident explains the no-fault side in more detail.

No-fault can also cover things workers' comp may not, such as some replacement services for household tasks you can't do while you recover.

Driving a company vehicle? Whose auto policy applies

If you were driving a car or truck owned or registered by your employer, Michigan's priority rules generally point to the employer's auto insurer for no-fault benefits, rather than your own household policy.

If you were driving your own car for work, your own no-fault policy usually comes first after workers' comp. And if you were a passenger in a coworker's car, the priority rules can get more complicated.

These priority questions decide which insurer you should be filing with, and filing with the wrong one can cost time. Our guide to who pays your medical bills after a Michigan car accident covers how the priority rules work in a regular crash.

Can you sue the driver who hit you?

You generally can't sue your own employer for a work injury. Workers' comp is the exclusive remedy against them.

But the driver who caused the crash is a different story. If another driver was at fault, you may have a claim against them for pain and suffering, and in some cases for economic losses beyond what no-fault and workers' comp pay. In Michigan, a pain and suffering claim generally requires meeting the serious impairment threshold. Our post on Michigan's serious impairment threshold explains what that means.

One catch: if you recover money from the at-fault driver, the workers' comp carrier may have a right to be reimbursed from part of that recovery for benefits it paid. How that's handled affects what you actually keep, so it should be planned for from the start.

Is your crash "work-related"?

This is often the first fight. Not every drive is part of the job. Some common situations:

• Driving for work during the workday: deliveries, sales calls, job sites, errands for your employer. These are usually work-related.
• Your regular commute: driving to and from your usual workplace is often not covered by workers' comp, though there are exceptions.
• Traveling employees and company vehicles: people whose jobs require regular travel, or who drive an employer-provided vehicle, may be covered more broadly.
• Rideshare and gig drivers: whether you're an employee at all, and which policy applies, raises separate questions. Our post on Uber and Lyft accidents in Michigan covers the passenger and driver side.

If the comp carrier says the crash wasn't work-related, no-fault may become your primary source of benefits. If both sides point at each other, you can get stuck in the middle without either paying.

Deadlines that can end a claim

Work-related crashes come with more than one clock:

• Tell your employer about the injury as soon as possible. Michigan's workers' comp law has notice requirements, and waiting creates problems even when the claim is valid.
• No-fault generally requires written notice to the insurer within one year of the accident.
• A lawsuit against the at-fault driver has its own limitations period. Our post on how long you have to file an injury claim in Michigan covers the general rules.

Missing any one of these can shut a door that the others don't reopen.

Common mistakes after a work car accident

Only filing one claim. Many people file workers' comp and stop, or file with their auto insurer and never tell their employer. You may need both.

Not reporting the injury at work right away. Even a short delay can give the comp carrier a reason to question whether it happened on the job.

Giving a recorded statement without preparation. Statements to any insurer can be used to deny or limit benefits. Our post on recorded statements after a crash explains why to slow down.

Settling the comp claim without looking at the rest. A comp settlement can affect your no-fault benefits and any claim against the at-fault driver. Those pieces should be coordinated.

Questions we hear often

Do I file with workers' comp or my car insurance? Often both. Workers' comp generally pays first for a work-related crash, and no-fault covers what comp doesn't.

Can I get both workers' comp and no-fault wage loss? You generally can't be paid twice for the same loss, but no-fault may owe the difference between what comp pays and what no-fault would pay.

I was driving my own car for work. Does my insurance go up? That depends on your insurer and the facts. In Michigan, no-fault benefits are paid regardless of fault, but how a claim affects your premium is a separate question.

Can I sue my employer? Generally no. Workers' comp is the exclusive remedy against your employer, but you may be able to bring a claim against another at-fault driver.

When to call ELN

Call us if you were hurt in a crash while working, especially if workers' comp and your auto insurer are pointing at each other, your wage benefits seem low, or another driver caused the accident. We'll look at which benefits apply, which insurer should be paying, and whether you have a claim against the at-fault driver.

Hurt in a car accident on the job? Schedule a consultation or visit our personal injury practice.

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