July 2016 Meldon Law Newsletter
Florida PIP Scam Discovered
Florida has had a law called Personal Injury Protection (PIP) since the early 1970’s. It requires that every car owner purchase PIP insurance that pays 80% of your medical bills and 60% of your lost wages up to a combined limit of $10,000.
In 2012 the insurance lobby convinced the Florida legislature to sign a bill into law reducing your maximum benefits from $10,000 to $2,500 (unless you have an emergency medical condition) and eliminating benefits for massage therapy and acupuncture with the stated goal of reducing our PIP premiums by at least 25%. Of course, this didn’t happen. What did happen was that your premiums increased by an average of 14.6%, just in 2015! Since the law was passed, rates have increased by as much as 50% with some insurance companies. But guess what? Insurance companies had a profit of 100 million dollars (just on PIP) before the law was passed, and in 2015 they had a profit of 900 million dollars! Sounds like we are getting the short end of the stick.
Why did this happen? Insurance companies are big and powerful and have significant influence up in Tallahassee. They promised to cut premiums voluntarily. When they didn’t there was nothing we could do but complain. PIP is compulsory and if you want to own a car and drive it, you have to suck it up. Sorry, but that is the cold hard fact.
I predict that in the next five years we will move away from a PIP No Fault Law and into a mandatory Bodily Injury Liability Insurance law. This would require that everyone has insurance that pays the innocent victim of a crash for their losses including their out of pocket medical expenses and lost income. Most states already have this type of law in effect. The big question is how much Insurance will be required. I think it will probably be $25,000 per person per accident and a maximum of $50,000 per accident no matter how many claims are made.
MY TIP: Get at least $100,000 in Uninsured Motorist coverage NOW! You are living in Florida, the wild west of the insurance industry. Protect yourself and your family in the event of a serious accident and injuries. You can get my FREE book “BUYING FLORIDA AUTO INSURANCE” by going to MeldonLaw.com or calling our office at (800) 373-8000.