I was in accident a year ago. To make a long story short, the insurance company didn't agree. My case went to the arbitrator. The arbitrator puts 100% liability on the other driver.
Again, doesn't sound much like a Michigan question as it is your vehicle insurer that pays crash related medical bills at the reasonable and customary rate.
If the arbitration is binding, they must pay the about instructed by the arbiter. They could also appeal the arbitration decision. Without more information, I can't say whether the settlement offered is fair.
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