Did Florida PIP Reforms Result To Lower Auto Insurance Premiums?

Has the reform on Florida no-fault system instituted last year yielded lower auto insurance premiums in Florida for its consumers?

Well, state Senate President Don Gaetz does not believe it did and had expressed disappointment over the insurance companies which had promised lower insurance premiums if the state’s no-fault system also known as PIP or personal injury protection would see reform and eventually rake in rate savings. The senator is now asking where the said rate savings are.

According to some insurance industry analysts, it is still too early to see the effects of the PIP reform which was signed into law on May last year by Governor Rick Scott.

Since 1972, motor vehicle operators in Florida had been required to carry no-fault coverage so as to insure that a person injured in an accident will get insurance money and not experience delay in the treatment of their injuries. With its no-fault system, auto insurance companies in Florida would be paying a maximum of $10,000 for a person’s medical expenditures and lost wages, whether the insurance policyholder is at fault or not.

The reforms on the no-fault system were designed to fight the rampant fraudulent practices taking advantage of the generous personal injury protection benefits. In recent years, fraudulent claims and staged accidents have been rampant in Florida especially in Miami and Tampa areas with many people not only insurance beneficiaries but as well as lawyers and health care providers milking insurance companies.

Florida’s PIP system is being described to have cost insurance consumers hundred millions of dollars.

The reformed PIP had placed a 14-day limit on seeking medical treatment following an accident. It also capped the PIP benefits to only $2,500 unless a designated health care provider will declare an injured person to be in an “emergency medical condition,” and only then that the person can avail of the full PIP benefits. Also, the reform had crash-out chiropractors among the list of health care providers that can determine whether a patient is in an “emergency medical condition.”