FL Gov Signs Bill Reviving No-Fault in State in 2008
On Thursday, Florida Gov. Charlie Crist signed a bill into law reviving state's no-fault automobile insurance law and the requirement that all motorists carry $10,000 in personal injury protection (PIP).
The changes restore mandatory personal injury protections, or PIP, as of Jan. 1. Between now and then, motorists can decide whether or not to buy the coverage, which pays for the first $10,000 in medical bills regardless of who caused an accident.
Florida had required motorists to carry PIP coverage since 1973, but the requirement lapsed Oct. 1. Insurance companies and trial lawyers battled for years to kill PIP, arguing it's a system rife with fraud that drives up insurance rates.
The new law "will have some important reforms — fighting fraud more aggressively, which is extremely important," Crist said at a Capitol bill-signing ceremony. "Extending care is a compassionate thing to do," Crist said. "Trying to take from the system is not."
Last week, legislators overwhelmingly passed the no-fault bill during a special session to cut the state budget.
The central fraud-fighting provision is the creation of a fee schedule dictating how much insurance companies can pay hospitals and doctors for treating accident victims.
Also, legislators set aside $2 million to beef up fraud prosecutions in metropolitan areas, including Palm Beach and Broward counties.
The personal injury protection coverage also protects drivers from lawsuits, as long as medical bills from car-accident injuries don't exceed $10,000 for any driver or passenger.
However, between now and when PIP resumes on Jan. 1, drivers could be sued for damages if they get in an accident and one driver doesn't have personal-injury coverage. As long as all drivers have PIP, the lawsuit immunity still applies.
After Crist signed the no-fault bill into law, special interest groups continued arguing about whether it's a good deal for consumers.
The insurance industry's political committee, Floridians for Lower Insurance Costs, said drivers with health insurance don't need PIP to cover their medical bills in a car accident.
The law "amounts to little more than a massive driving tax by forcing drivers to continue purchasing a duplicative medical payments coverage many do not want or need," said Allison North Jones, a spokeswoman for the group.
But organizations representing Florida hospitals cheered the decision. Hospitals had warned that without PIP, they'd end up taking on much more uncompensated care, citing statistics that 40 percent of auto accident victims don't have health insurance.
"Restoring PIP helps Florida's trauma centers to carry out their crucial, life-saving mission," said Tony Carvalho, president of the Safety Net Hospital Alliance of Florida.
Published on October 12, 2007
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