Michigan Workers Comp - What Are The State Minimum Coverage Requirements? (& Why You Need More…)

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In Michigan, the state minimum coverage limits for workers' compensation are set at $100,000 for bodily injury or disease per accident, $500,000 per policy, and $100,000 per employee. This might seem like a lot, but let’s talk about why opting for higher limits can be beneficial.

First, let's consider the other options available. Beyond the state minimum, you can choose higher limits like $500,000 per accident, $500,000 per policy limit, and $500,000 per employee. Or even better, $1,000,000 across the board.

Now, why would you want these higher limits? Imagine a scenario where an employee suffers a serious injury on the job, requiring extensive medical treatment and a long recovery period. The medical bills and lost wages could quickly exceed the state minimum limits.

Higher coverage limits can ensure that all these costs are covered, protecting both your employee and your business from financial strain.

For example, let’s say an employee needs surgery and months of rehabilitation. With only the state minimum coverage, you might find that $100,000 per accident is not enough to cover all the expenses. But with higher limits like $500,000 or $1,000,000, you’re much more likely to cover all costs without dipping into your business funds.

Additionally, if a claim involves legal fees or settlements, higher limits can provide the necessary financial cushion. This extra layer of protection can save your business from significant financial hardship.

In real-life cases I’ve seen, businesses with higher coverage limits have been able to handle severe injury claims smoothly, without the financial stress that comes with exceeding the coverage limits.

How does increasing the coverage limits impact the premium? You would actually be surprised that the cost difference to increase the coverage limits can be pretty minimal. So purchasing higher limits can definitely be a worthwhile investment for the price and it is always worth asking your agent to price out the higher limit options.

So, while the state minimums provide basic protection, higher coverage limits offer peace of mind and financial security. It’s about making sure your business is prepared for the unexpected.

Explanation on Limits and Part A, also known as Part 1, and Part B, also known as Part 2:

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**DISCLAIMER: THIS IS NOT LEGAL ADVICE. USE AT YOUR OWN DISCRETION. THIS VIDEO INCLUDES MICHIGAN INFORMATION ONLY.