Senate eyes possible no-fault insurance repeal

By Jim Turner, News Service of Florida
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TALLAHASSEE, Fla. - A key Senate committee next month will take up a proposal that would replace the state's no-fault auto insurance system, while a similar bill has already sped to the House floor.

Senate Banking and Insurance Chairwoman Anitere Flores said the proposal (SB 150) by Sen. Tom Lee, R-Thonotosassa, will be among the first discussed by her committee when the annual legislative session begins Jan. 9. The committee had been slated to take up the issue Tuesday, but time ran out in a scheduled two-hour meeting.

“The intention will be to have a vote on this bill, up or down, at that meeting,” said Flores, whose committee heard several other bills Tuesday before starting a discussion on Lee's proposal.

The proposal would repeal the no-fault law, which requires motorists to carry $10,000 in personal-injury protection, or PIP, coverage to help pay medical expenses after accidents. It would require motorists to carry $5,000 in what is known as medical payments coverage, or MedPay, and minimum amounts of bodily-injury coverage that would increase over time.

During the 2017 legislative session, Lee's proposal was dubbed “PIP renamed” by Rep. Erin Grall, a Vero Beach Republican who sponsored no-fault repeal legislation in 2017 and is carrying the House bill (HB 19) for the 2018 session.

Lee said he expects the competing proposals will start to be matched up as the Senate version advances towards a floor vote.

“The most important thing to me is we get coverage rates up for people that are injured in an accident in our state, and right now $10,000 gets eaten up on just about every accident that happens,” Lee said.

The requirement that motorists carry $10,000 in PIP coverage essentially hasn't changed since 1979. The no-fault system is designed to help limit lawsuits stemming from traffic accidents.

The House proposal does not include a requirement of carrying MedPay coverage.

Sen. Rene Garcia, R-Hialeah, surmised that Lee's proposal could result in higher premiums --- particularly for inner-city residents in minority communities that rely upon personal-injury projection for their only coverage --- and would increase litigation.

“They will be litigating with the insurance companies as opposed to the health companies as to who is going to pay what and what amount of damages they're going to pay,” Garcia said.

Lee acknowledged that people only paying for minimum coverage now would likely see rate increases, particularly residents of urban areas such as Southeast Florida where rates are already higher. But he doesn't anticipate much change in the courts.

“It's not that you'll be unable to recover, it won't be a pot of money sitting there to attach by a lot of service providers, except in an emergency situation, where I wouldn't want to leave people bare or the providers bare, who have no choice, as you known, but to take care of these patients when they arrive in the emergency room,” Lee said.

Before introducing an amendment that more narrowly defined the MedPay requirements, Lee's proposal was projected to raise rates about $8 to $12 a year, as the savings from the elimination of no-fault would be offset by increases in premiums for bodily-injury liability coverage and uninsured-motorist coverage.

The House measure, which faces opposition from some insurers, business groups and medical providers, has been projected to save motorists on average about $80 a year.

Grall's proposal, which was backed by the House Commerce Committee in an 18-7 vote last month, would eliminate the system's limits on lawsuits. Drivers at fault in accidents would be fully liable for damages, with the minimum bodily-injury coverage under Grall's proposal being $25,000 for damages for injury or death of one person and $50,000 for injury or death of two or more people.

Lee's proposal, starting Jan. 1, 2019, would set a minimum of $20,000 for bodily injury protection that includes coverage for the injury or death of one person and $40,000 for injury or death of two or more people.

The coverage would grow to $25,000 and $50,000 two years later and to $30,000 and $60,000 on Jan. 1, 2023.

Lawmakers in 2012 passed a package of changes --- championed by Gov. Rick Scott and then-state Chief Financial Officer Jeff Atwater --- that were considered a last-ditch effort to maintain the no-fault system after rates increased because of fraudulent claims.

Lawmakers in both chambers have considered bills annually since 2013 that sought to repeal PIP, with the House passing a Grall bill during the 2017 session. The bill died in the Senate.

News Service of Florida