People from Metro Detroit who have cars out of state for a substantial part of the year are facing a costly car insurance issue.
Several parents with kids attending college outside Michigan, along with snowbirds, are reaching out to Local 4 for answers.
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“My insurance was going up, so I looked around for other insurance, and I have a child in North Carolina, and he’s transferring to Pennsylvania,” one Metro Detroit dad said.
He started entering his information into the online sign-up sheet for a popular car insurance provider.
“They asked me where the vehicle was garaged,” he said. “The ‘garage’ spit me out in North Carolina.”
He called a live agent for the insurance company.
“They said, ‘Yes, you can’t be in North Carolina for more than 30 days,’” he said. “And then, when I asked, ‘Well, what about if he’s going to college?’ They said, ‘It doesn’t matter.’”
Turns out, in many cases, this is true and could cost hundreds.
“If they are out of state for more than 30 days, they are driving illegally, and they need to register and insure their vehicle in that other state,” the dad said the agent told him.
In many cases, it’s recommended that people either get a policy in an additional state or risk getting fined.
“I put this out to my friends, and one of them said his son was in Dallas and got pulled over because his vehicle was a Michigan vehicle in state and his dorm room said Texas, so he got hit with a $750 fine,” the dad said.
Of course, it’s not just college students who are leaving the state of Michigan. This could impact snowbirds or anyone traveling out of state for an extended time.
Local 4 did some digging and reached out to the Insurance Alliance of Michigan.
They tell me that, for snowbirds, you may need to update your “garaging” address to stay covered.
They say each insurance company may handle the situation differently, saying a college kid must be legally domiciled at their parents’ house to remain on their parents’ insurance.
“The safest thing to do is notify your insurance company right away that you have a kid that’s moving out and letting them know where they are going to be,” Lawrence Kajy, the CEO of Kajy Law Firm, said.
The state’s Department of Insurance and Financial Services also says it’s up to each insurance provider, saying snowbirds should update their garaging address.
“I told the gentleman that the one insurance company that the vehicle will only be there 29.5 days and that I will bring it home and put it back,” the dad said. “I thought it was a real pain. I know I’ve gone out of state - to Arizona, and did not have this problem.”
Statement from Erin McDonough, executive director of the Insurance Alliance of Michigan:
“A college student is eligible to be on their parents’ auto insurance policy in Michigan while attending an out-of-state college if they are still legally domiciled at their parents’ house.
This can mean the student still uses their parents’ home as a mailing address and uses their parents’ address on their driver’s license or other documents, among other things.
Each insurance company may handle the situation slightly differently, so it is very important for families to consult with their insurance company or agent and be transparent about the car location and ownership before the student moves out of state for college to make sure proper insurance coverage is secured.
A student may not be covered under their parents’ policy if the student establishes legal residency outside of Michigan or if the student registers the vehicle in that state, among other things.
Other states may also have different insurance requirements than Michigan, so we encourage students to check with a local insurance agent from that state and their college admissions office.”
Erin McDonough, executive director of the Insurance Alliance of Michigan
Additional statement from the Insurance Alliance of Michigan:
“If your vehicle is registered in Michigan, you must maintain Michigan auto no-fault insurance, even if you leave the state for months. The policy will cover you when you are in other states.
Some insurance companies may ask you to update your garaging address if you are gone for an extended period of time, but this will vary by company. You should reach out to your insurance company or agent if you have any questions about being gone from the state for an extended period of time.”
Insurance Alliance of Michigan
Statement from the Department of Insurance and Financial Services.
“Families who have students who are not living at home should discuss their policy with their insurance agent or company.
Some insurers consider out-of-state students who intend to return home as members of the household under the terms of the auto insurance policy.
Each situation may have unique circumstances, which is why it is important to discuss this information to an agent or insurance company.
Students should not assume they are covered by a parent’s auto insurance policy without discussing and documenting their individual situation with their agent or insurer.
DIFS strongly encourages consumers to shop around and compare coverage options, including with respect to whether out-of-state students are covered by the policy. Doing so helps consumers find the policy that best meets their needs and budget.
Consumers and insurance agents, and companies with questions or concerns can contact DIFS Monday through Friday, 8 a.m. to 5 p.m. at 877-999-6442 or via email at AutoInsurance@michigan.gov. For more information about auto insurance in Michigan, visit Michigan.gov/AutoInsurance.”
Department of Insurance and Financial Services
Additional statement from DIFS.
“We cannot speak to insurance requirements in other states, but Michigan law requires an auto insurance policy for any vehicle driven in the state for more than 30 days in a calendar year.
If a vehicle is in Michigan for over 90 days, it must also be registered in Michigan. Drivers should update their garaging address with their insurer and adjust coverage as needed when the vehicle is stored out of state.”
Department of Insurance and Financial Services