Currently under Florida’s no-fault system, motorists are required to carry $10,000 in personal-injury protection (PIP) coverage which is designed to pay medical bills after accidents. However, there is a new proposal to eliminate the $10,000 no-fault coverage which also requires motorists to get at least $25,000 in coverage for bodily injury or death and $50,000 for bodily injury or death of two or more people.
While there is an upswing – the legislation is expected to save motorists $80 a year per policy – not everyone is on board. Orlando attorney Rutledge Bradford said the proposal would take away benefits that provide some short-term relief from medical expenses and lost wages. “When you go straight to a system that only pays benefits for someone who was not at fault, you’re cutting out a large segment of people,” Bradford told the House Panel. “PIP pays medical bills within 30 days, pays wages every two weeks. These health care providers, hospitals need a way to be paid.”
The no-fault reform law championed by Gov. Rick Scott and state Chief Financial Officer Jeff Atwater in 2012 was put in place to lower rates caused by increases in insurance due to an increase in fraudulent claims. The law also required people involved in crashes to seek treatment within 14 days, allowed up to $10,000 in benefits for emergency medical conditions, and put a $2,500 cap on non-emergency conditions.
According to the state Office of Insurance Regulation, if the no-fault system is replaced by bodily injury (coverage for motorists that cause accidents and hurt someone else), there would be an increase in courtroom activity regarding questions of medical coverage as injured parties would seek to recoup expenses from at-fault drivers. According to a House staff report, the change could also negatively impact health care premiums.
While the proposal may not be perfect (many companies including Nationwide Insurance, State Farm Mutual Automobile Insurance Co., and the Personal Insurance Federation of Florida feel it also needs to address the state’s bad-faith laws), recent reports indicate that some sort of reform may be necessary. Since 2015, PIP rates have gone up 25.7 percent and liability rates have increased 23.4 percent – all due to an increase in the cost of medical care, the rising costs of parts and labor for vehicle body work, the increase of motorists, and an increase in distracted drivers.
To read more about the proposal to eliminate Florida’s no-fault system, click here. At Anton Castro Law, we remain up to date on the state’s laws as well as the associated changes and reforms. If you’ve been injured in an accident, our knowledgeable team of personal injury attorneys will represent your best interests and achieve a compensation that you deserve. For additional information or to request a consultation, please call us today at 813-907-9807.