On April 17, 2013, the Florida Senate Committee on Banking and Insurance approved SPB 7152 as committee bill SB 1888 (the “Bill”). The Bill would eliminate Florida’s no-fault personal injury protection (“PIP”) coverage requirements, which were reformed just last year as the result of serious negotiations. To view our blog post covering last year’s reforms, click here. The reforms were one of Governor Rick Scott’s legislative priorities to crack down on the fraud abuses in PIP cases that have led to skyrocketing costs for coverage.
Currently, PIP coverage awards insureds up to $10,000 for medical bills and lost wages if an emergency medical condition exists or up to $2,500 otherwise, regardless of whether or not they caused the crash. Also, in order to obtain the benefits, injured persons are required to seek treatment from a licensed physician, osteopath, chiropractor or dentist, and not from a massage therapist or acupuncturist. This has led to litigation regarding the constitutionality of the reforms that is still pending.
The Bill would, among other things, replace PIP coverage requirements with bodily injury coverage requirements, in which case the insurer of the party at fault would pay for medical care. This change would require that the injured party bring a lawsuit against the insured. In addition, insureds would be required to have financial responsibility coverage of at least $10,000 for property damage, $25,000 for bodily injury or death to another and, subject to a $25,000 limit for one person, $50,000 for bodily injury or death of two or more people in one crash. A policy that provides at least $60,000 for combined property damage and bodily injury liability would also satisfy the financial responsibility coverage requirements. Proponents of the Bill believe that it will help curb fraud and reduce insurance rates. Opponents of the Bill are concerned that a tort based system would result in delays in accident victims receiving compensation to pay their medical bills along with their incurrence of court costs. There is also a concern that Florida ranks as one of the highest states in the amount of uninsured drivers, which could make it difficult for accident victims to recover all of their damages.
The Bill has been referred to the Senate Committee on Appropriations for review.
For a copy of the Bill, click here.