Significant Changes, New Restriction on Florida Auto Insurance

The Florida Legislature passed some pretty significant changes to the Florida No Fault Law last week. Florida No Fault, otherwise know as personal injury protection (PIP), is a type of coverage under auto insurance policies required by Florida Law (Florida Statute 627.736). The law originally passed decades ago and is intended to provide medical and income coverage to persons injured in a crash regardless of fault. The coverage comes from the injured person’s own policy. It generally provides 80% of medical expenses and 60% of lost wages up to $10,000.00. There is sometimes the option of “extended PIP” which provides greater coverage.

PIP coverage is an important safety net in our society because it allows a person to get checked out by the emergency room or other doctor after a crash if either that injured person is at fault or the other person who is at fault has chosen not to accept responsibility. In other words, if the at fault person or other person’s insurance company refuses to except responsibility, the injured person can get treatment under his or her own insurance policy while waiting for the other person’s insurance company to “come around” – which in today’s insurance industry climate, may never happen. Further, it protects the injured person if they do not have health insurance to pay for treatment.

The trade off for mandating such coverage on every Florida consumer is a limitation on who can sue the at-fault driver and for how much. A threshold requirement was put in place to fetter out non-permanent injury claims from auto crashes. In essence, if there is an injury from a crash that is not permanent or did not causes some scarring or loss of body function, the injurer person can get treatment for these types of injuries under the PIP coverage. If the decision is made to sue, the person can sue for economic losses, bills and wages, but is not allowed to sue for the human losses: pain, suffering, inconvenience, and loss of enjoyment of life. If the injuries are permanent in nature or caused scarring or loss of bodily function, then the person can sue the at-fault driver for both economic as well as human losses. A qualified doctor giving a medical opinion as to permanency is required to meet this threshold.

There has been important debate recently about whether to keep PIP, modify it or let it die. The debate stems from fraudsters, crooked doctors and crooked lawyers taking advantage of the system. There have been several articles in recent years about these scams. The other side of the debate argues that while the fraud must be addressed, this safety net should not be eliminated for the majority of Florida citizens.

Just last week, the Florida Legislature passed changes to the PIP statute that adds new requirements for use of this coverage. According to the Orlando Sentinel, at midnight on the last day of a 60 day session, the Senate in a 21-19 vote passed the new measure. The new law gives crash victims up to 14 days to seek medical treatment using PIP coverage – a compromise from the 7 day cut off Governor Rick Scott wanted. The new law does not cap attorney’s fee, meaning that if a Florida consumer prevails in a case against his or her insurance company for not providing PIP coverage when by law and contract the insurance company should, the consumer will have greater options of competent attorneys willing to take the case.

The new law also requires the PIP only pay chiropractors if there is a referral from a medical doctor. A problem with the previous law was that some crash victims would go to chiropractors who would eat up, or “exhaust”, all of the PIP coverage before the victims was given the proper tests, such as MRI’s or nerve conduction studies which can be very expensive, to accurately diagnose the injury or condition. Hopefully, this new law will correct this danger to the consumer.

Only time will tell if this new law will correct the problems with the prior PIP system while protecting this valuable coverage for all law abiding citizens. Hopefully, these changes will be the correction the system needs to be successful.