Today, motorists in Florida have the third most expensive insurance costs in the country. Lawmakers this year are considering repealing a no-fault car insurance policy which has been under scrutiny for its high costs, inefficiency, and fraud. If the policy ends, drivers can save $81 per car – summing up to $1 billion annually, according to a state study.
Legislators need to act
What will legislators do? Repeal bills in the past two years have not gotten anywhere in the Senate. They were merely passed along from the Florida House.
Senate President Bill Galvano was asked what his stand is regarding this issue, by GateHouse Media. Katie Betta, a spokeswoman, said, “Based on the conversations President Galvano has been having with senators about issues they are interested in, he believes there is an appetite in the Senate to look at insurance issues like the assignment of benefits, workers’ compensation, and PIP. Because it is still very early and he would like senators to have the opportunity to develop legislation and work it through the vetting that takes place during the committee process, he does not plan to offer specific comments beyond that at this time.”
Then Governor-elect Ron DeSantis’ transition spokesman did not comment.
State Representative Erin Grall is expected to file a repeal bill, not unlike those passed in the recent years. She was not available to comment, though. Preparations have begun to take place for a 60-day session which takes place early March.
Top 5 States with the Most Expensive Car Insurance
- Rhode Island
(Source: Insure.com 2018 survey, based on average premium for the 40-year-old male driver based on quotes with six large carriers in 10 zip codes in each state)
Surveys have showed
On the other hand, more surveys are being conducted. One study released last November shows that Florida has moved up to 3rd (previously 5th) in the most expensive states for car insurance. Michigan takes the number one spot. These states follow a no-fault auto insurance system (PIP). This system mandates all drivers to purchase health care coverage on their car insurance, which will be used if they engage in an accident – regardless of who caused the accident. This stands even if the person already has Medicare or other work health plans.
PIP is “absolutely ridiculous”…
Dick Natalizio from Palm Beach Gardens, a former insurance company owner and is now retired, says that this PIP system is just “absolutely ridiculous.” He said he tried talking to the leaders of the state to ask them to stop this system. He can’t understand why drivers who already have health care coverage are still required to buy $10,000 of PIP by the government. This is insurance that a person doesn’t need or want, and still, it spikes his costs up – even if he remains safe on the road, just because it is the law of the land.
The Palm Beach Post reports that PIP isn’t a sole factor in the skyrocketing insurance bills, but the rates have been going up quicker than overall premiums. It jumped 25% up between 2015 to 2018.
Over the past two years, a bill has been passed from the Florida House to remove this system. It will save people so much money. These savings are after the bill mandates motorists to secure bodily-injury liability insurance, which almost all US states require – and most Florida residents already have.
At the moment, Florida still is one of the two states who doesn’t require it, which translates to this: It doesn’t tell its drivers to be responsible for any injury they may cause to others.
The high number of uninsured drivers
Industry surveys reveal that up to 26% (or higher) of Florida motorists are “uninsured.” This doesn’t always mean they have no insurance: the state allows motorists on the roads with minimal coverage as long as it has PIP; which means they don’t have insurance which lets them responsible for other people’s injury.
Paul Davidson from Boynton Beach said, “For the life of me, I don’t see the purpose of PIP.” He was hit by a driver on A1A, and he flew 60 feet. He said, “My lip was ripped up to my nose. Two of my teeth were missing. I was knocked unconscious.”
Still, the state’s system didn’t mandate the motorist to secure insurance to pay for Paul’s medical expenses. He had to use his insurance and own money, which amounted to tens of thousands of dollars.
The repeal bill has been stalled in the Senate because of heavy interests by the industry, including clinics, medical providers and hospitals, even specialty insurance firms and attorneys who make a living on PIP.
Lobbyists are getting involved
Trial lawyers have supported the bill. However, lobbyists from big insurers have fought them with lawsuit reforms. Insurance reps pleaded with the Senate committee to vote NO on this bill, which almost definitely killed the hope of winning the PIP repeal.
Requiring medical payments coverage in PIP’s place will mean that patients will at least have some degree of coverage in the emergency room, according to the Florida Medical Association general counsel Jeff Scott.
Requiring this coverage just “repackages” PIP and requires motorists who don’t need it to still pay for it. Say goodbye to driver savings.
Majority of US states don’t use the no-fault system anymore. Drivers from Colorado save up to 35% on car insurance since this system was abandoned.
Every year that Florida keeps this system, its residents pay the price.
When PIP was born
The PIP was born in the 1970s with the vision of avoiding lawsuits and reducing costs. What happened instead was a record-breaking mountain of over 60,000 lawsuits back in 2017 – an almost 50% rise in just a year, based on the Florida Justice Reform Institute’s report. A lot of these aren’t just filed by regular citizens, but also by medical providers who are suing to get paid.
What do drivers do now? All they can do is shop around for the best possible coverage. There are tons of online comparison websites these days, like the ones who conduct the surveys and studies mentioned earlier. And it goes without saying that if people truly want things to change, then now is the time to speak up.
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