After years of debate, measures have moved forward in both chambers of the Florida legislature to repeal the state’s 50-year-old motor vehicle no-fault law. Senate Bill 54 has already passed, while companion House Bill 719 was approved in the committee stage on April 19, 2021. The proposed legislation has been the subject of some controversy among lawmakers, insurance industry experts, and consumer groups, who argue over how eliminating the no-fault law will affect insurance rates.
Under the current no-fault rule, if you were injured in a Miami car accident, you would seek compensation from your own insurance company through your Personal Injury Protection (PIP) coverage. If passed and signed by the governor, Florida would essentially become a so-called “at-fault” state: You would file a claim with the at-fault driver’s insurance company to obtain monetary damages after a collision.
Obviously, the elimination of no-fault principles is a major reversal of existing law and will have considerable implications if you were hurt in a motor vehicle crash. Here are some things to know as the bills move closer to passage.
Motorists will be required to carry bodily injury liability coverage. Existing no-fault laws require Floridians to purchase PIP coverage in their auto policies, which pays out to the policyholder for losses after an auto collision. PIP will no longer be mandatory, since a victim will look to the at-fault driver’s policy for coverage. As such, motorists must carry bodily injury coverage in the amount of $25,000 per person ($50,000 for two or more victims).
There are implications for other aspects of your auto insurance policy. Regulations on PIP coverage also imposed limitations on what you can recover as compensation from your own insurer. With PIP eliminated, the restrictions on damages for pain and suffering are also abolished. However, under the bills currently under consideration, insurers may offer medical payments coverage without a deductible. Insureds can obtain amounts for their own medical expenses – regardless of fault.
Insurance companies will face new issues with bad faith requirements. The bills also include requirements for insurers who receive claims from victims injured in accidents caused by their own policyholders. These are called third-party claims because the victim does not have a direct contractual relationship with the insurance company. Insurers will be required to negotiate in good faith in resolving third-party claims, and there will be ramifications for bad faith failure to settle with the claimant.
It is still crucial to retain an attorney for help. Whether or not no-fault is eliminated, solid legal representation is critical for injured victims. Insurers will always aim to protect the company’s interests, not yours – as a policyholder OR third party. Your lawyer will ensure you receive a fair amount through the claims process, and will take the case to court as necessary.
Discuss Fault and Insurance Issues with a Miami Car Accident Attorney
The new fault-based system would take effect Jan. 1, 2022 in Florida if approved, so no-fault principles still apply to auto collisions occurring before that date. For more information, please contact Gerson & Schwartz, PA. We are happy to set up a free consultation at our offices in Miami, Fort Lauderdale, or West Palm Beach, FL.