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Craig Cannon
Craig Cannon
Contributor •

PIP Car Insurance

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I have written several times now on the state of PIP Insurance in Florida. In my opinion if PIP is allowed to sunset on October 1, 2007, automobile drivers in Florida will be allowed to drive without any insurance coverage whatsoever. This would be a disaster.

It finally appears as if Governor Crist and the Florida CFO, Alex Sink, agree with me. Apparently the CFO has been looking at the PIP issue since the recent legislative session ended. According to an article in the Miami Herald , the CFO is almost ready to present a proposed bill to Governor Crist that would reinstate PIP coverage with some changes.

One of the changes anticipated is stronger fraud provisions. According to the insurance industry, there is widespread fraud under PIP and that is one of the main reasons they want to see it sunset. While fraud may be an issue, specific legislation designed to imnplement stricter enforcement and penalties should solve that problem.

Another apparent change would be to implement fee schedules for the physicians submitting biills for payment under PIP. While there may be some opposition to this change from the medical community, as long as the fee schedule is reasonable (200% of Medicare is what is usually discussed) this change would be preferable to no PIP at all.

One final change that is contemplated is a limit on attorney fees when disputing an insurance company’s refusal to pay car accident related medical expenses. Since this is an area of law in which I practice, I am opposed to any limit on attorney’s fees. I believe that we (attorneys) and the threat to an insurance company of having to pay attorney’s fees in addtion to the benefits owed, is the primary enforcement mechanism to keep the insurance companies acting in a fair and reasonable manner toward their insureds.

While there are certainly fraudulent medical providers and fraudulent claimants out there, there are also fraudulent insurance companies who will do whatever they can to limit or eliminate their responsibility to pay legitimate PIP claims. Without the threat of legal action, for which they are responsible for payment of the attorney’s fees, there is little to stop the insurance companies from behaving in unfair and unreasonable ways. This is clearly evident in what has happened to the Worker’s Compensation system in Florida (another story for another day). However, as with the medical fee schedules, as long as the attorney fee provision in the PIP legislation is fair and reasonable, it is better to have PIP than not.

Another change that I would impose, not seemingly contemplated by the CFO and Governor Crist, would be to require, in addition to PIP and property damage coverage, a mandatory bodily injury liability coverage.