What is PIP? Will Florida Repeal PIP?

By Janelle Squire, Esq. and Jerry Jenkins, Esq.

What is PIP repeal and why is it important for you (the consumer and Florida driver) to understand? Before we can explain this, let us give you some background on Personal Injury Protection or “PIP.” In 1971, Florida adopted the No-Fault Statute. In these laws, personal injury protection coverage was created. The law requires every person that lives in Florida and owns a vehicle to carry PIP coverage. If you move from another state or country, you must acquire this coverage within 90 days.

What exactly is PIP? 

If you are injured in an auto accident (even if you were not at fault), PIP covers a percentage of your medical expenses and lost wages up to $10,000.00. Again, even if another driver caused your injuries, you would still file a claim with your own insurance to cover the first $10,000.00 of your medical expenses. Therefore, it is called PERSONAL Injury protection coverage because it covers you and your expenses. Some people think of it as health insurance, but only for auto accidents. And if you have health insurance, your health insurance would be secondary to any PIP benefits, which takes on the role as primary coverage for any accident-related injuries and treatment.

When Florida’s PIP statute became effective in 1972, it has a PIP benefit amount of $5,000 but it required mandatory bodily injury coverage of $10,000. The mandatory bodily injury was repealed in 1977.  In 1979, the PIP benefit was increased to $10,000.

PIP repeal proposed in 2021

The Bill for PIP repeal, titled SB 54, eliminated the PIP requirement and required that all drivers carry a minimum of $25,000.00 for the bodily injury of one person and $50,000.00 for all persons in an accident. Additionally, it would have required to insurance companies to offer $5,000.00 in medical payments for coverage of medical expenses.

Why are people in favor of repeal?

Those in favor of PIP repeal point to the abuse and fraud surrounding PIP claims. Insurance companies have expressed that PIP fraud is one of the largest reasons why our auto insurance premiums are so high in Florida. Also, the majority of states have abandoned the PIP model in favor of requiring drivers to carry higher bodily injury limits to cover damages when they are at-fault for an accident.

Also, many drivers in Florida only carry the minimum auto insurance coverage required, that is $10,000 Property Damage and $10,000 in PIP benefits.  If someone at fault in an accident caused an injury that required you get treatment, you would not be able to make a claim against their insurance. People are injured every day on the roads of Florida and cannot recoup any monetary damages due to the current system.  As most of the drivers that carry these minimum limits have very little assets and are judgment proof. In fact, of the 10 states that have similar PIP statutes, Florida is one of two that doesn’t require mandatory bodily injury coverage at some level.

The PIP statute, although it has been revised several times, has not had an increase in benefit amount since 1979.  As you can image medical costs have skyrocketed.  The average medical bill for an emergency room visit for a neck injury isn’t even covered by the PIP benefit.

Why are others opposing repeal?

Hospitals, doctors, and other healthcare providers worry that without PIP, people will be limited in medical treatment and payments for medical providers would be slowed down. Also, because many vehicle owners are either uninsured or underinsured in our state, the innocent car accident victim could be left with no insurance benefits to use for medical treatment.

Also, many drivers in Florida only carry the minimum insurance coverage, again that is $10,000 Property Damage and $10,000 in PIP benefits.  Having to carry Bodily Injury Coverage would increase their premium.

What is the next step in PIP? 

Despite both the Florida House and Florida senate overwhelmingly voting to repeal PIP, the Governor vetoed the bill. In his letter dated June 30, 2021, Governor DeSantis expressed that while he understood that the current PIP system was flawed, the bill did not “adequately address the current issues facing Florida drivers and may have unintended consequences that would negatively impact both the market and consumers.”

So, while PIP repeal did not pass in 2021, most parties agree that this is only the beginning of the fight for change in Florida auto insurance laws and that we will likely continue to see legislation for repeal in 2022. The Florida Senate has proposed SB150 and the Florida House of Representatives has proposed HB1525.

We support mandatory bodily injury coverage, whether PIP is repealed and replaced or as an additional coverage.