Once upon a time, an experiment with no-fault insurance promised to lower Florida drivers’ insurance rates. Back in 2012, it seemed that no-fault with PIP was the wave of the future, promising to bring relief to drivers hammered by rate increases. Since 2015 rates have gone up by over 25 percent after what had been a significant drop of over 14 percent after 2012. Part of this is due to the fact that the $10,000 minimum for personal injury protection insurance that was set in 1979, and has failed miserably to keep up with inflation. In fact, $10,000 then would be worth nearly $33,000 today. What’s more the system has been filled with notably large frauds and abuses leaving Floridians paying the some of the highest auto insurance rates in the United States.
He Said, She Said
As with everything about insurance, the idea of reforming PIP is riddled with controversy. Consumer advocates and insureds accuse the auto insurance industry of wanting Floridians to pay more money in premiums, but get less in coverage. While others claim that repealing PIP will save consumers money. Some motorists even view being required to carry PIP when they already have health insurance, a form of double taxation. Instead of curbing fraud or reducing the rates of lawsuits, nothing seems to help. Hospitals and doctors are for keeping the $10,000 policy in place, even though it does not begin to cover serious injuries sustained in a car accident. Nowadays, $10,000 might not even clear your emergency room bill. *
Throwing the Baby out with the Bathwater?
A study found that Florida drivers could save $81 per car by getting rid of PIP. $81 can get you a heckuva brunch, a lot of five dollar margaritas with a puny tip, or feed a crowd on dollar taco Tuesday. Aside from that? Not much. One of the biggest problems in Florida is how few people have health insurance, and how many drivers are driving uninsured. Mixing these two together can be a recipe for disaster. Without health insurance, if you are in a catastrophic accident the bills can be immense. If you are driving without auto insurance, you are fully liable for any damages to other cars, property, or people. Going without insurance is guaranteeing that should you be in an accident, your life is going to get extremely rough.
What Can You Do Now?
The legislature will be reconvening in the first week of March to address the PIP issue, assignment of benefits fraud, and other issues. For the time being, best thing you can do right now is to have a consultation with an independent insurance agent, and review your insurance picture. Getting you covered with a comprehensive insurance plan that is tailored to your budget is the best thing you can do to protect yourself, your property, your future, and your family.