Michigan Supreme Court: No PIP benefits owed where fraud occurs during litigation  



By: Jonathan Schwartz and Joshua W. Zhao

In Williamson v. AAA of Michigan, No. 165131, the Michigan Supreme Court held that statements made during the discovery phase of litigation can constitute fraudulent insurance acts under Michigan’s no-fault statute that would make a person ineligible for personal injury protection (“PIP”) benefits under the Michigan Assigned Claims Plan (“MACP”). 

The MACP provides an injured person with coverage if there is no other applicable insurer. The claim is assigned to a Michigan auto insurer, but as a matter of law, a claim that is supported by a fraudulent insurance act is ineligible for a payout under the MACP. In 2018, Charles Williamson applied for PIP benefits after he was struck by a car. The MACP assigned Williamson’s claim to AAA of Michigan (“AAA”). Williamson sued AAA after AAA refused to pay benefits. In 2019, Williamson died in an unrelated accident, and his daughters continued the lawsuit as representatives of Williamson’s Estate. When answering discovery, the Estate attached replacement-service and attendant-care forms for services rendered after Williamson had passed away. One of Williamson’s daughters signed the interrogatory answers on the Estate’s behalf, acknowledging that she believed the answers to be true. AAA moved for summary judgment, arguing the Estate knowingly made material misrepresentations by submitting reimbursement forms for services rendered after Williamson had passed away. As a result, the Estate was not eligible for PIP benefits from the MACP. The trial court granted the motion for summary judgment, but the Court of Appeals reversed.

The Michigan Supreme Court reversed the Court of Appeals and affirmed the trial court. The Supreme Court held that the answers to interrogatories supported a demand for PIP coverage based on bodily injury and thus supported a “claim” for no-fault benefits – in other words, prelitigation statements are not the only statements that can constitute “fraudulent insurance acts” under MCL 500.3173a(4).  As a result, false interrogatory answers could constitute a “fraudulent insurance act” and would negate the provision of benefits. The Michigan Supreme Court declined to address the Estate’s alternative arguments that AAA had failed to prove the intent or materiality aspect of a fraudulent insurance act and remanded the case to the trial court.  

This case highlights the importance of candor in all aspects of a claim when applying for MACP benefits, as a misrepresentation could bar benefits all together. 

Please do not hesitate to contact Jonathan Schwartz at, Josh W. Zhao at, or your local FMG relationship partner with any questions.