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No-Fault Coverage To Return In January

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By JEROME R. STOCKFISCH, The Tampa Tribune

Published: October 6, 2007

TALLAHASSEE - Drivers will once again be required to carry personal injury protection in their auto insurance policies as of Jan. 1 after lawmakers agreed Friday to return Florida to its status as a no-fault state.

House Republicans threw a wrench into a deal on Thursday when, against their lead negotiator's advice, they targeted the fees collected by plaintiffs' attorneys in a bill sent to the full House floor. But Friday, attorney fee caps were stripped from the bill, and both chambers passed the measure.

'It appears that the House was struck with an inordinate amount of good sense after we went home last night, and they corrected their bill,' said Sen. Bill Posey, R-Rockledge, the upper chamber's lead negotiator.

Rep. Ron Reagan, R-Bradenton, who amended the original deal to include the legal fee caps, said he wasn't going to let the cap issue derail the bill.

'When it came right down to it, I wasn't going to let the bill blow up,' he said. 'I think PIP is more important than even my situation.'

For more than three decades, Floridians had been required to carry $10,000 in personal injury protection, or PIP. In the case of an accident with injury, each driver was then covered by his own insurance policy.

But the PIP system was considered to be riddled with fraud. Lawmakers allowed it to expire Monday.

The state then reverted to an at-fault system, under which crash victims can seek damages from the person causing an accident - often in court. That status will continue until Jan. 1.

Gov. Charlie Crist ordered no-fault onto the agenda of the special session running through Friday. He is expected to quickly sign the bill into law.

A key component of the new law limits the types of medical professionals who can order or provide services under PIP.

Another sets up a fee schedule limiting how much can be charged for various medical services. That is expected to reduce fraud in so-called 'PIP clinics,' where critics say unscrupulous medical providers have run up charges, performed unnecessary procedures, and even staged fake accidents and filed false accident reports.

Critics of the new law said it didn't go far enough to combat fraud and abuse in PIP. It does not include what is known as a utilization schedule, which spells out treatment procedures for various conditions. And it does not address attorneys' fees.

Some House Republicans sought to cap the fees that lawyers can collect when they sue insurers on behalf of policyholders who have been denied benefits. They said lawyers were earning exorbitant payouts for obtaining relatively minor benefits.

But Posey insisted the Senate would not pass a bill limiting attorney fees. House negotiator Rep. Ellyn Bogdanoff, R-Fort Lauderdale, urged her colleagues to honor the deal she struck with Posey and refrain from amending it.

On Thursday, a House committee chaired by Reagan attached the attorney fee caps anyway, leading to the stalemate that was resolved overnight.

The Republican plan would have limited lawyers' paychecks to $10,000 or three times the amount of the benefit they obtained for their client, whichever was greater.

Posey and the Senate considered that unfair.

'When you make the playing field unlevel, when you allow insurance companies to spend $10 million to fight you, but you're limited to just $10,000, that's not justice,' Posey said. 'That is not a fair fight. That is not consumer-friendly, so it could not go in this bill.'

The standoff ultimately drew Crist into the debate.

'I think it's great that they have honored the great work that Senator Posey and Representative Bogdanoff have done and the hours of labor that they put in,' the governor said after Friday's votes.

Take These Questions To Insurers

Should I drop my PIP coverage between now and Jan. 1?

No. Under legislation the governor plans to sign, the state's no-fault law would still apply between now and then in a crash between two drivers who carry PIP coverage, which means the cost of treating your injuries will still be covered no matter who is at fault. Although PIP is no longer required, the vast majority of Florida drivers still carry the coverage.

If my policy comes up for renewal before Jan. 1, can I retain my PIP coverage?

It depends on your insurer. Some are no longer providing customers the option of buying PIP coverage at renewal. Instead, they are offering replacement coverage such as medical payments and bodily injury. This will temporarily increase the number of drivers with no PIP coverage.

What will happen if I crash with a driver who doesn't carry PIP coverage before Jan. 1?

Accidents will be handled under a fault-based system. Police and the courts will determine which party is at fault before insurance benefits are paid.

What's the best way to deal with auto insurance coverage between now and Jan. 1?

Call your auto insurer to discuss your existing coverage. Some are allowing customers to drop their PIP coverage, while others are not. Dropping PIP from your auto policy will reduce your premium, but be sure you have enough coverage to protect yourself and your assets in the event of an accident.

Where can I get more information?

Visit a Web site operated by state Chief Financial Officer Alex Sink's office, myfloridacfo.com.

Russell Ray

Reporter Jerome R. Stockfisch can be reached at (850) 222-8382 or jstockfisch@tampatrib.com.

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