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Ask A Lawyer: Florida’s Faulty No-Fault System

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Posted on September 11, 2012

Florida law requires all car owners to purchase Personal Injury Protection (“PIP”) insurance, which is also called “No-Fault” since it provides benefits regardless of who was at fault for a crash.

Basically, PIP provides up to $10,000 of insurance to the policyholder, relatives living in the policyholder’s household, as well as some passengers in their car, and even pedestrians who are hit by the insured car.

The main idea is supposed to be getting speedy payment of medical bills and lost income to everyone involved in an auto accident. PIP doesn’t cover compensation for pain and suffering (that’s liability insurance, which is optional for most people), but it should at least cover the basics of medical bills and wage losses.

However, a new PIP law was passed by the Republican legislature in May. The law went into effect on July 1, 2012, but portions of the law dealing with medical and death benefits will not become effective until January 1, 2013. There are several provisions that could be harmful to people who end up in a wreck. The highlights of the new law include:

1. Auto accident victims must seek medical care or treatment from a qualified medical provider within 14 days of the crash or else PIP will not provide any medical benefits. We all know that many people try to “tough it out” hoping that their pain will just resolve itself without a doctor. Sometimes it does, but under this law those who ignore their pain may find that they waited too long, and are just left to go home and suffer with no help.

2. PIP will only pay up to $2,500 in medical benefits unless the patient has an “Emergency Medical Condition.” To qualify for the full $10,000 in medical benefits, the auto accident victim must suffer symptoms severe enough to indicate that the lack of immediate medical attention could put the victim’s health in serious jeopardy, damage
bodily functions, or cause a body part or organ to stop working properly. That means that most people are only going to have $2,500 dollars of insurance for routine follow up treatment, and that usually is just not enough.

3. Treatments like massage therapy and acupuncture are no longer covered, which is ironic since recent studies have showed these can be at least as effective in treating soft tissue injuries as conventional (meaning expensive) medical treatments. In exchange for this bail out at consumers’ expense, insurance carriers are supposed to reduce PIP premiums by a whopping 10 percent by this October, and 25 percent by 2014. The bottom line from all these changes is that we cannot count on the no-fault system for basic benefits any longer. It is therefore more important than ever for accident victims to seek guidance from a competent, experienced attorney right away after an accident.

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