Florida may soon see a change in the type of insurance it requires its drivers to maintain. As of now, the state requires all drivers to have personal injury protection (PIP), but Senator Tom Lee is offering a new approach. Several lawmakers are unhappy with the current PIP law and the way an influx of third-party lawsuits have clogged up the Florida court system. This week, Lee submitted a bill that would replace the PIP requirement with bodily injury liability coverage instead. The bill moved through the Senate Infrastructure and Security Committee with a 6-1 vote, so it is slated to advance through to its next phase of approval.
What is The Problem With PIP?
As of right now, every driver is Florida is required by law to carry personal injury protection as the bare minimum in auto insurance coverage. Personal injury protection provides coverage for the financial costs of any medical expenses following an auto accident regardless of who is at fault. Those costs include, but are not limited to, things like lost wages due to missed time at work, any type of substitute needed to carry on with your day to day activities, and even funeral expenses. With the current PIP law, an insured driver in Florida can receive up to $10,000 for an emergency condition and, at most, $2,500 for a non-emergency condition. With such amounts, one would have to experience significant physical pain or death before receiving much financial assistance. A main concern with PIP is that limits are indirectly placed upon one's damages for the pain or injury experienced. Naturally, this has led to a drastic increase in third-party claims and lawsuits, and many lawmakers are concerned that precious time and money are being spent on these matters. For some, it seems the third-party lawsuits have gotten way out of hand. While most lawmakers agree that a change needs to be made to current PIP law, some claim the real work needs to be done in addressing bad-faith reform before tackling the issue of PIP law.
What is Bad-Faith?
Bad-faith refers to an insurance company's attempt to avoid providing payment as outlined in the insured's policy agreement. The insurer may refuse payment outright or may avoid the insured in more subtle ways like continued refusal to return communication about a claim. Bad-faith claims can be complicated and often involve third-parties, and this is where lawmakers are noticing a very complex web being woven between bad-faith and PIP coverage. The incessant lawsuits filed from third-parties against insurance companies is believed to have overburdened Florida's courts, and moves are being made to consider the most effective next steps.
What Would The New Auto Insurance Requirement Be for Me?
Lee's repeal would replace PIP with bodily injury liability coverage which means a driver would be covered for injuries he or she causes to anyone else in the event of an accident. The insurance would cover medical costs, lost wages, and legal fees. Medical costs can include appointments, medications, necessary equipment like a wheelchair or brace, and any therapy needed as a result of the accident. This new requirement would come with increased coverage amounts and various stipulations. Drivers would be required to carry $10,000 for property damage, at least $25,000 in liability for causing injury or death to one person, and $50,000 for causing the same to two or more people in the accident. Additionally, medical payments would become optional, and those would be covered with $5,000. The biggest difference in ideology between the current and proposed legislature is the establishment of fault. The current PIP law covers medical expenses regardless of fault, and the proposed change to bodily injury liability coverage prompts the insured to assume responsibility of and pay for injuries caused to anyone else involved in the accident.
Which Should I Do in the Meantime?
Until any laws change, absolutely follow current state law in regards to what kind of insurance you are required to hold as a driver in the state of Florida. Be sure to follow a variety of local news outlets so that you can stay up-to-date on the progress of this potential change. The beginning of the year is a great time to educate yourself on state laws and upcoming changes for your area. It never hurts to take the initiative to learn more about local law and government because it can save you from having to learn the hard way after it is already too late. If you have any questions or concerns regarding PIP or bodily injury liability coverage, you can always reach out to us here at Keller, Melchiorre & Walsh for clarity and assistance. Let a trusted professional help guide you through these often confusing changes.