Automobile Insurance Mandatory Bodily Injury Coverage
There is a proposed bill in the Florida legislature (HB 267) that would scrap Florida’s “no-fault” system and replace it with a system of mandatory bodily injury insurance coverage. Presently, the no-fault system requires every Florida driver to purchase Personal Injury Protection (PIP) and property damage insurance. PIP is supposed to pay for your medical bills and lost wages up to a maximum of $10,000.00 if you are injured in a car accident regardless of whether you caused the accident. Property damage insurance pays for damage you cause to the other driver’s car or personal property. The stated goals of the no-fault system were to assure that persons injured in vehicular accidents would be directly compensated by their own insurer, even if the injured party was at fault; that there would be fewer lawsuits; that automobile insurance premiums would be lowered; and, that there would be an end to purported inequities of recovery under the traditional tort system. Florida Senate and Banking Committee Report “Florida’s Motor Vehicle – No-Fault Law” – November 2005.
Over the years the shortcomings in the no-fault system have become apparent. One such shortcoming is that PIP is oftentimes inadequate to cover one’s medical bills and lost wages after an accident. As is also well-known, insurance companies will deny what they unilaterally perceive to be questionable medical and lost wage claims which in turn prompt PIP lawsuits against the insurance companies. Finally, despite repeated promises from automobile insurance companies, auto insurance premiums have not been lowered. In a recent article Charles Elmore of the Palm Beach Post points out that some families in Miami-Dade County are required to pay premiums of more than $3,000 a year for only $10,000 in PIP coverage. As Mr. Elmore also mentions, 85 percent of drivers nationally have health insurance and the Affordable Care Act is designed to help the remaining 15 percent get it. This thus begs the question whether a Florida driver needs to be paying for both PIP and health insurance.
What I like best about HB 267 is that it puts financial responsibility for the privilege of driving a motor vehicle in Florida on the driver of that vehicle. Under the present no-fault system a driver has so-called “full coverage” when he or she has only PIP and property damage coverage. Under the proposed legislation, Florida’s no-fault law would be repealed and every insured driver would have to carry at least $25,000 in bodily injury coverage for injury or death caused to any one person in an accident, $50,000.00 in bodily injury coverage for injury or death to two or more persons in any one accident; and, $10,000 in property damage coverage. The latter coverage does not change under the proposed legislation. For those persons who are concerned about immediate payment of their medical bills after an accident HB 267 allows them to purchase medical payments coverage. Such coverage is not mandatory however.
If passed and ultimately approved by both chambers of the Florida legislature, House Bill 267 goes into effect on January 1, 2015. Any automobile insurance policy issued or renewed after that date may not include PIP. Any existing motor vehicle insurance policy issued before January 1, 2015 will be deemed to meet the minimum security requirements until such policy is renewed, nonrenewed or canceled.
I believe HB 267 is a positive step forward for Florida drivers and I encourage you to contact your
Florida legislators and urge them to vote for this legislation. Go to https://www.flsenate.gov/ to find your representatives in the House and Senate.