Reader question:

I’ve heard that changes are being made in Florida’s car insurance laws. Is this true?

Rosa

It could be.

On October 1st, 2007, if everything goes as Florida State Legislature wishes, Florida’s requirement for $10,000 PIP insurance on every car will fade out after being part of state law for 36 years. According to the car insurance companies in the state, getting rid of PIP will lower the rates of fraud and program misuse. They also claim that it will eliminate duplicate coverage and bring about lower auto insurance rates. State Farm, by far the largest insurer in Florida, received approval from the state that it could lower its rates by 16%, due, mostly, to the removal of PIP from the law.

Critics in Florida’s hospitals and other medical providers say that all the new law does is shift the responsibility–to them. Some also say that the responsible, safer drivers will simply add on more insurance to themselves in order to protect them from uninsured drivers, which will just make their rates higher. So the question here is, is anyone really benefiting? Are the people who should be benefiting doing so?

One comparison that comes up is Colorado, which released citizens from being legally bound to have no-fault insurance back in 2003. Since then, the state has seen record drops in the pricing of car insurance coverage. ‘At the same time, though, the Colorado Hospital Association claims that its acute trauma system has lost up to $80 million more a year since then. They blame it on a lack of PIP coverage.

So, the question is, is a lawsuit-based system going to have a negative effect on Florida’s health as well?

Cheers,

Fashun Guadarrama.