Under Florida’s no-fault system, motorists are required to carry $10,000 in personal-injury protection, or PIP, coverage. That coverage is designed to pay medical bills if a motorist is injured in an accident that is was not their fault. The House Bill HB 1063 that is up for a vote,  proposes that the $10,000 no-fault coverage would be eliminated, and a new mandate would go into effect in 2018. The new insurance mandate means drivers must purchase at least $25,000 in coverage for bodily injury or death as well as $50,000 for bodily injury or death of two or more people.

Florida Insurance Reform 2012

Florida has been trying to reform and fix PIP laws in the past, however albeit unsuccessful. But what did change was insurance reform in 2012 which was an attempt to deal with the insurance rate increases due to insurance fraud. Beginning in 2012 if you were involved in car accident, you had to seek medical treatment within 14 days. Also, accident victims had an allowance of up to $10,000 in emergency medical benefits, with a $25,000 cap on non-emergency benefits. This was an attempt to reduce the number of fraudulent claims but did it work?

Rising Costs of  Car Insurance in Florida

Many Florida residents seem to support the Bill, but others see it as another way to put more money in the pockets of the insurance companies while making it even more difficult for people to purchase insurance or to obtain compensation for their losses. Since 2015, car insurance rates have gone up 25.7. Liability coverage has gone up 23.4 percent.  This cost increase is attributed to the current cost of medical care, increase in distracted drivers and a higher cost for auto-body repair services. Florida already has a problem with uninsured drivers thus, it’s crucial to have laws in place that will protect people who are injured and who do require immediate compensation for lost wages and medical bills.

Some say that the whole problem stems from fake personal injury lawsuits and fraud. Although fraud is a valid concern, the bigger concern may be how this new law might make even more challenging for people to obtain the immediate relief for losses incurred and compensation they need when they have sustained life changing and devastating injuries from a motor vehicle accident. There are many lawmakers who believe the “bad faith” law needs to be reformed stating that without it, personal injury attorneys could continue to sue for damages when policy limits are low. Forcing people who were not at fault into litigation to recoup medical expenses and loss of wages could be counterproductive. Punishing honest, insured drivers who have been severely injured in a car accident that was not their fault, could make their life changing situation even more difficult.

The Bill passed a state House subcommittee 12-2 Monday.