Florida PIP Confusion

Drivers in Florida are rightfully confused right now. There has been a bitter struggle, insurance company vs. insurer company and medical professional vs. medical practitioners and lawyers vs. Insurance company… and verses upon verses. All this while Florida’s poor driving public is trapped in the middle, unable to see or understand what is going on.

Let’s first find out what exactly PIP actually is.

The basics

The first states can be divided into two types: PIP States and Tort States. It is easier to understand and make things a little simpler if you are in a Tort state. If you are involved in a car accident, and you are “At fault”, then you are responsible to the injuries of others. You could be sued for the injuries sustained by other drivers and passengers as well as any property damage.

To cover such damages in a tort-state, you must have liability insurance. In most states, the minimum liability is 25/50/25. That means $25,000 for bodily injury you cause to one person in an accident, $50,000 total for property damage and $25,000 per accident for bodily injury.

PIP States: There were 38 PIP States at one point in fifty states. Today, there are 12 er none, 11 er not effective January 1, when Florida “rebecomes” an PIP State 12.

What is the purpose of PIP?

PIP is, frankly speaking, a lot more complicated than tort. Why? First, each state has a different level PIP. To explain PIP, we must first explain “PURE PIP”, which is what no state uses.

A “Pure PIP” system would allow each individual to take full responsibility for their injuries in an accident. Lawsuits against the other would be forbidden. Also known as “No Fault”, PIP stands for Personal Injury Protection. Each person would, theoretically, purchase their own policy to compensate for their injuries rather than sue the AT FAULT person. You can see how attorneys would feel about this. However, this is not the only problem. The second concern is how much coverage each person should receive under a “PURE PIP.” system. The remaining PIP states offer varying levels of PIP.

Florida PIP

1971 Florida lawmakers passed the PIP Law. Liability insurance was no longer required. However, one coverage was needed to register your vehicle. PIP.

Florida PIP coverage is available to all citizens of Florida. This policy provides $10,000 for them to pay for any injuries they sustain in an auto accident. No matter who is at fault, your coverage will cover you.

These laws were immediately problematic. This law was immediately contradictory to Florida’s responsibility law. It states that if a driver causes an accident that results bodily injury, property damages or disables an automobile, you must show that you have liability limits of $10/20/10 or $30,000 together.

Second, the law didn’t cover property damage done by the at-fault driver. It was fixed a few more years later when mandatory property damage liability of $10,000 was added to registration requirements.

The issue of tort immunity or tort exemption was another problem. It is a problem that no one truly understands.

What is Tort?

PIP’s purpose is to protect the innocent. You may not sue the responsible party under “PURE IPIP”, but you can still sue them. This is Tort Immunity. Each state has its own PIP levels and different degrees of tort immunity. To vary the tort immunity, each state must determine the limits. States have either a Financial or Verbal threshold. If a person’s medical bills exceed $50,000, they are not allowed to sue the person at fault.

Florida has a “Verbal Thin” but each person is responsible to the first $10,000 in their own injuries. However, you cannot sue the “At Fault” driver for any economic damages over $10,000. But, you can sue him for pain and suffering.

What were the problems with PIP, you ask?

The spirit of PIP is noble. Instead of suing everyone in small accidents, the PIP coverage would pay “most” of your medical expenses, loss and work, as well as some household chores. This would result in a decrease in lawsuits.

The law was noble but it also added a new level of litigation/or negotiation to the process. That is, determining whether a threshold was crossed. Florida’s verbal thresholds for loss of bodily function are: 1. Permanent impairment of bodily functions 2. Permanent injury 3. Permanent injury 3. Death.

Death is the easiest threshold. A person who is still breathing can be determined if the threshold has not been exceeded. The person cannot sue “non-economic” injuries like pain or suffering. The other thresholds, such as significant scaring, may be more difficult to interpret. This is due to the fact that there are fewer lawsuits.

Let me ask you to recall the last time you drove and got into an accident. How many people did you see in each vehicle? Minimum 2, 6, 10, Whatever number you choose, multiply it by 10,000

The problem was “Fraud”. Unprofessional medical professionals bilked companies no matter how minor the injury. Insurers paid artificially high bills to cover their injuries.

Florida’s Flip Flop

The long-suffering PIP law in Florida was repealed on October 1, 2007. Many insurance companies bid it farewell, only to have it revived a few days later at the request of Florida’s governor.

At the moment, there is no PIP Law in force, no $10,000 money bag to cover medical expenses, and no tort immunity. PIP coverage will resume on January 1, 2008.

Many companies were able to add a “Non- Statutory” PIP that would provide $10,000 benefits to all employees. We recommend this, along with at least $2,000 in Medical Payments or uninsured motorist.

It’s a good idea to call your agent now and go over your coverages.