Almost every state requires drivers to carry insurance. In Florida, every driver is required to buy a personal injury protection policy. However, the legislature has recently overhauled the requirements in an attempt to lower premiums for all drivers.
The law requires a 10 percent reduction in premiums by October 1. Following this required reduction, another 25 percent reduction must occur by January 1, 2014. If either of these does not occur, the insurance company must provide an explanation to the state as to why that reduction is not possible.
While some believe the changes are necessary, others worry about the impact on the victims of motor vehicle accidents.
The current PIP policies pay out the first $10,000 of any medical bills from an accident, regardless of who is at fault. The new law will place much stricter limits on the types of medical treatments that can be reimbursed. For example, as of July 1, insurance proceeds will not be paid out for massage or acupuncture treatments. Also, proceeds used for nonemergency treatment of accident-related injuries will be limited to $2,500.
These changes are a result of skyrocketing personal injury protection costs that have been attributed to staged accidents. Since 2009, most insurance rates have increased exponentially. For example, State Farm has seen a 94 percent increase in rates.
The effect of this legislation is still yet to been seen. Unfortunately, the greatest impact of all may be felt by those legitimately injured in vehicle accidents who will now be more limited in the treatment they can seek. For those suffering injuries that may not need “emergency” treatment, money may not be available to cover treatment.
Source: Sun Sentinel, “PIP reforms come with many unanswered questions,” Kathleen Haughney, June 25, 2012