According to the Insurance Information Institute, Floridians pay the nation’s third-highest car insurance rates despite state roads being relatively straight, flat and ice-free.
Among the most cited causes is Florida’s no-fault insurance regulations or Personal Injury Protection (PIP) statutes. Under the state’s PIP statutes, Florida is one of only two states that does not require drivers to carry coverage for injuries or deaths if at fault in an accident.
Repealing PIP, a state study found, could save Floridians $81 per car per year, nearly $1 billion collectively, but bills seeking to do so have failed over the past decade.
This year, PIP repeal bills again are working through committees, with sponsors citing tweaks that make them more palatable to insurers, physicians and hospitals that have vigorously opposed past reform attempts.
Although the House Insurance & Banking Subcommittee on Tuesday approved a bill repealing Florida’s 50-year-old Motor Vehicle No-Fault Law in a 13-1 vote, opponents made it clear they’ve just begun to fight.
House Bill 771, filed by Rep. Erin Grall, R-Vero Beach, removes liability limitations provided under PIP. If adopted, beginning July 1, drivers faulted in accidents would be fully liable for damages they cause.
“It’s time we make a policy decision that favors personal responsibility over that no-fault system,” Grall said, noting there were 60,000 PIP lawsuits filed in Florida in 2017, up from 20,000 in 2016.
HB 771 now moves onto the House Government Operations & Technology Appropriations Subcommittee and Commerce Committee.
Its Senate companion, Senate Bill 378, sponsored by Sen. Tom Lee, R-Thonotosassa, has passed through the Senate Infrastructure & Security Committee and awaits hearings before the Senate Banking & Insurance and Appropriations committees.
Florida adopted no-fault in 1970. It requires vehicle owners and drivers to obtain $10,000 in medical, disability and funeral expenses insurance without regard to fault, subject to a limit of $2,500 for nonemergency medical care. In exchange for maintaining PIP, drivers are immune from tort claims.
HB 771 and SB 378 would require drivers to secure bodily injury liability coverage of at least $25,000 for death or injury of one person, $50,000 for injury or death of two or more people and $10,000 for property damage.
Although some committee members acknowledged adopting a tort system could have unintended consequences and suggested limiting third-party lawsuits against insurers, all expressed frustration with PIP.
“I can’t help but think when we ensure Floridians have a higher amount of coverage, we’re actually helping costs to go down,” said Rep. Al Jacquet, D-Mangonia Park.
Insurers, physicians and hospitals call the measure “a lottery” for those injured in car accidents and said the state needs to also revise “bad faith” laws.
“A claimant can refuse to provide documents and ignore phone calls and emails, but then set arbitrary deadlines for a settlement,” Florida Justice Reform Institute attorney Kathy Maus said. “They’re hoping the insurer misses the deadline, so they can sue the insurer for 100 times the policy limits or more.”
The American Property Casualty Insurance Association maintains without “bad faith” law revisions, “Florida’s broken tort system,” which had “a $6.6 billion impact on premium costs” in 2017, will increase further.
Opponents argued the opt-out/opt-in provision will result in fewer people with medical coverage.
Florida Chapter of American College of Surgeons’ Chris Nuland said 12 percent of state residents don’t have health insurance, predicting increases in uninsured will result in corresponding hikes in health-insurance premiums.