Florida Lawmakers Are Looking At Repealing PIP Once More
Personal injury protection (PIP) insurance has been around for decades, and for nearly as long Florida legislators have been wondering what to do about it. And with the start of the new year, the state congress is once again thinking about repealing it and replacing it with bodily injury coverage.
Why PIP Matters
Everyone who owns a vehicle with a Florida license plate needs to buy auto insurance coverage, which includes $10,000 of PIP coverage. This is a “no fault” insurance policy, which means that it pays out to the person who has the policy when he or she is physically injured by an auto accident. Even if that person was a pedestrian at the time, PIP will pay out. Or at least it’s supposed to.
No-fault insurance is supposed to save people time and money because you don’t need to go through all the legal hoops of establishing fault. That still happens for property damage coverage, but for injuries to people it’s important to get the money right away for hospital bills and treatments.
But Florida suffers from one of the highest insurance fraud rates in the country, and PIP fraud is a big part of it. This has inspired the state government to pass extra restrictions and regulations on PIP coverage that makes it hard even for honest policy holders to get all of the $10,000 they’re paying for. And on top of that, spiraling health care costs mean $10,000 just don’t go as far as they used to.
What Might Replace PIP
Personal injury protection is no-fault, but 38 states use the with-fault alternative: bodily injury coverage. Like property damage coverage, bodily injury policies pay out when the person covered is partly or fully responsible for an accident. It also comes with uninsured protection for when the responsible party doesn’t have any insurance.
While bodily injury coverage has to wait for investigations and rulings, this means there’s less room for fraud and coverage limits can go up. The Florida House of Representatives has a bill with a minimum of $25,000 of bodily injury coverage, and the Senate has a bill requiring $30,000. Overall this is a cost-neutral change: depending on the county you live in you could pay over $100 less or $30 more.
The main objection to replacing PIP with bodily injury coverage is the same as an objection applied to PIP today: since there’s a federal health insurance mandate, most people (at least theoretically) should already have health insurance. So there’s no need to add extra health insurance to auto insurance, plus the sort of person who doesn’t buy the one will probably not buy the other. And if PIP goes away without any replacement, motorists could pay almost $100 less per year throughout the state.
Other objections to the current bill come from the Personal Insurance Federation of Florida, a lobbying group that represents the major insurance groups. According to them, Florida’s “bad faith” laws are too permissive when it comes to who can sue an insurance company over how they handle a claim, and so adding a new fault-based policy will bring on more lawsuits. But this ignores the fact that most auto accidents already involve property damage and those insurance policies, and so bodily injury policies will only increase the stakes of existing claims and lawsuits.
Making an insurance claim after an auto accident can be confusing and difficult even without Florida’s constantly changing laws, and so it can help to have the consultation and representation of a professional personal injury lawyer throughout the process. That’s why Shapiro, Goldman, Babboni, Fernandez, and Walsh offer our services to Florida citizens throughout the Tampa region and beyond. Contact us today and we’ll give you a free initial case review.