Florida's No Fault Law Has A Few Faults

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When the Florida Legislature passed the "Florida Motor Vehicle No-Fault Law" in October 1976, it had two purposes in mind: First, it wanted to ensure everyone who owned a motor vehicle had a minimum of benefits for treatment for accident related injuries. Second it wanted to limit the insurance companies' exposure and result of automobile accidents.

Seventeen years since the law passed, we must ask ourselves whether accident victims are really receiving the medical disability and death benefits provided in the law.

Florida law states that "80 percent of all reasonable expenses for necessary medical, surgical, x-ray, dental, rehabilitative services, including prosthetic devices, and necessary ambulance, hospital and nursing services," are to be paid under the personal injury protection coverage of the auto policy, or "PIP."

Those provisions may appear straight forward, but the words " reasonable" and "necessary" have created fertile ground for insurance abuses that have resulted in delays for the injured and an unfair advantage for the insurance industry against their wounded and often financially strapped insured.

The law further states that the insurer must pay within 30 days after receiving a claim, but further provides that the insurer can delay payments if it has "reasonable proof " that it is responsible for paying.Once again, the word "responsible" provides the window of opportunity for companies to avoid their statuary obligation. Insurance carriers often submit the medical records to an independent review, providing them with the necessary "proof" to stall the payment of benefits.

While insured people may ultimately win in court, they may end up being responsible for paying medical bills while their cases wind through the courts. Often unable to pay for the medical bills, they forego treatment recommended by their physician rather than pay out a significant sum for which they may not be reimbursed. Of course, when they forego treatment, the insurance company is relieved of a possible obligation to pay.
Typically, health insurance carriers will not pay until all PIP benefits are exhausted, foreclosing that avenue of payment.

Florida laws also provide that the insurance coverage will pay "60 percent of any loss of gross income and loss of earning capacity per individual" in case an accident leaves a person unable to work. As with the provision governing medical benefits , the insurance company's physician may challenge whether someone is unable to work. Also, most accident victims don't know that the law entitles them to reimbursement for household expenses, such as lawn maintenance, house cleaning and other services that they could have performed had they not been injured.

Unfortunately, the insurance carrier is not always forthcoming with information about available benefits to the injured party. Contrary to popular belief, many accident victims do not retain a personal injury attorney before seeking medical treatment and are unaware of their benefits.

In addition to providing medical and disability benefits to those injured in automobile accidents, the Legislature sought to limit the recovery of certain damages, such as pain, suffering, mental anguish, and inconvenience, unless the victim sustained a "permanent injury."

Once again , the inexactitude of medical science becomes the focal point of the dispute. There is an abundance of physician discretion in the diagnosis and treatment of soft tissue injuries typically received by accident victims.

Can the law be amended to effectuate its purpose?

In the most recent session, there was a bill sponsored by local lawmakers- Sen. John McKay, R-Bradenton, Julie McClure, D-Bradenton. The "Bill of Rights of Insured," as it was called, basically stated that the Department of Insurance would develop a brochure to be sent to those involved in automobile accidents. The document was to explain the rights of the insured under current law. The insurance carrier was obligated to mail the Bill of Rights to the insured within two days after receiving notice of the accident. The idea was to have it mailed with the application for no-fault benefits that is mailed to every person seeking PIP coverage.

The bill also provided that the Department of Insurance impose a mandatory fine of $100 per. day on insurers that failed to pay benefits within 30 days as provided. Finally, the bill required the department to review the records of fines levied against insurers every three months. If the department found that there was a pattern from the insurer of not paying personal injury benefit payments, the state could fine the company between
$1,000 and $ 10,000. Despite support from the medical and legal communities, the $8 million cost of the measure was its death knell. also stated that it only received about close to 1 million claims.

Unfortunately, the public's lack of knowledge regarding PIP benefits could explain the paltry number of complaints being filed against abusive insurance carriers. The insurance commissioner certainly recognized this probably as evidenced by his estimate of the cost to handle the number of anticipated increase in complaints and violations of the bill became law. The concern for the proliferation of claims would suggest that he believes the injured parties who were to benefit from the no-fault law should be kept in the dark.

Significantly, the Department of Insurance ignored the provision of the proposed bill levying fines on insurance companies for abuses that could have offset the cost to the Department of Insurance. More Importantly, the Department of Insurance seems to both acknowledge the inequities and turn a blind eye to the needs of the vulnerable insures against carriers who manipulate the system.

Some of the problems with the no-fault law would be alleviated by the passage of the Bill of Rights for Insured. Even David needed a stone to defeat Goliath.

The idea that it is better to keep the actual beneficiaries of our laws uninformed of their rights rather that incur additional work and costs is repugnant to the principles of democracy for which we aspire.


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