Michigan Supreme Court Ruling on PIP Eligibility for Unlicensed Drivers

The Michigan Supreme Court ruled unanimously on March 10, 2026, that an unlicensed driver involved in a car accident is still eligible for personal injury protection (PIP) benefits, despite driving without a valid license. The decision focuses on the interpretation of the term "taken" in the relevant statute, highlighting how statutory language can impact eligibility for insurance claims.

In this case, Carlonda Naishe Swoope drove her friend Kandice Valentine's car without prior consent, intending to reach her ill mother. Although Swoope lacked a valid driver's license and did not have her own automobile insurance, she sought PIP benefits through the Michigan Assigned Claims Plan, which assigned her claim to Citizens Insurance Company of the Midwest. The insurer initially denied the claim, citing MCL 500.3113(a), arguing that Swoope's use of the vehicle was unlawful.

The trial court refused to grant an initial dismissal of the case. However, the Court of Appeals reversed this decision, arguing that driving without a valid license constituted unlawful operation. This was largely influenced by a previous case, Ahmed v Tokio Marine America Ins Co, which suggested that any criminal violation in taking a vehicle would disqualify a driver from receiving PIP benefits.

The Supreme Court rejected this interpretation. Justice Kyra H. Bolden emphasized that "taken unlawfully" in MCL 500.3113(a) pertains to the act of taking possession of the vehicle, not the legality of driving it. The court reiterated distinctions from prior precedents, notably the 2012 Spectrum Health decision and the 2014 Rambin decision, which stressed that unlawful taking requires obtaining a vehicle against Michigan law or without the owner’s permission.

For insurers, this ruling clarifies the application of MCL 500.3113(a). The determination of PIP eligibility hinges on the method of obtaining the vehicle, rather than the driver's licensing status. Insurers must recognize that disqualification from PIP benefits depends on how the vehicle was acquired, not the legality of the driver's operation at the time.

The case will return to the Court of Appeals to reassess whether Swoope's use of Valentine's car without permission qualifies as an unlawful taking. For Michigan auto insurers, this decision underscores the importance of understanding the nuances of statutory language when determining PIP benefit eligibility.