No-Fault wage loss benefits pay injured car accident victims 85 percent of the wages they would have earned had they not been injured. That is why it is called "wage loss." These are wages you have "lost" because of your injuries from a car accident. It therefore, cannot be speculative. There is no such thing as "earning capacity." These are wages you can show you would have earned but for being injured in a car accident.
Work loss consisting of loss of income from work an injured person would have performed during the first 3 years after the date of the accident if he or she had not been injured. A Michigan auto accident victim is entitled to receive No-Fault wage loss benefits for the first three years after the date of the accident.
Because the benefits received from personal protection insurance for loss of income are not taxable income, the benefits payable for such loss of income shall be reduced 15%
Wage loss formula
For a Michigan auto accident victim who was employed at the time of the accident, she is entitled to receive from her No-Fault auto insurance company "wage loss benefits" equal to the "income" she would have earned "from work [she] would have performed ... if she .. had not been injured."
For a Michigan auto accident victim who was "temporarily unemployed" - or working reduced hours - at the time of the accident, her wage loss benefits "shall be based on earned income for the last month employed full time preceding the accident." (MCL 500.3107a) That means people who are actively looking for employment when they are injured in a car accident can still recover wage loss from their No-Fault insurance companies.
The critical factor in establishing that an auto accident victim is entitled to No-Fault wage loss benefits is showing that the victim's accident-related injuries have disabled her from working and, thus, prevented her from returning to work.
A victim's work disability is most commonly verified through a certificate, statement, note or prescription by one or more of the physicians who are treating the victim for his accident-related injuries.
A physician-issued work disability certificate or statement will specify the following: Whether the auto accident victim is totally disabled from working, whether the auto accident victim is partially disabled and may return to work but only with certain specified restrictions, the period of time during which the work disability is expected to last, and the injury and/or injuries that causing the victim to be disabled from working.
Excess wage loss
If the monthly limit and/or the three-year limit on wage loss benefits is insufficient to cover a Michigan auto accident victim's actual lost wages resulting from his accident-related injuries, then the victim can pursue a claim for "excess wage loss benefits." (MCL 500.3135(3)(c))
To do so, the victim will have to sue the driver who allegedly caused the accident and prove in court that the driver was actually "at fault" in causing the accident.
Additional resources provided by the author
More information about maximum monthly wage loss amounts can be found in the “Insurance Bulletins” section of the website for the State of Michigan Department of Licensing and Regulatory Affairs (LARA). See a link below for that section as well as a link to helpful resources for Michigan drivers.