Proper auto insurance coverage can end up costing policyholders far more than they intended. That’s due in part to some laws on the books in parts of the United States. One of these laws is no-fault insurance, which requires drivers to carry personal injury protection coverage, or PIP, in the amount of $10,000 to cover their own injuries in a car accident regardless of who’s at fault. However, Florida is looking to stray away from this kind of car insurance.

The Problem With No-Fault Insurance

The Problem with No-Fault Insurance

Florida’s House of Representatives voted overwhelmingly to repeal the state’s no-fault auto insurance law that requires PIP coverage to cover injuries regardless of who is to blame in an accident. Though insurance costs are some of the lowest in the nation in the Sunshine State, Florida drivers paid the fifth-highest average auto insurance bill in the U.S. because of PIP premiums. This is because of an effective free rein for drivers to file car accident claims with their own insurers.

One of the greatest concerns over Florida no-fault insurance was fraudulent claims. Other states were quick to do away with no-fault laws or modify them as scam artists figured out cracks in the system and started exploiting them. There has been ongoing legislation in both the Florida House and Senate to overturn this briefly vetoed law that makes their state one of just two nationwide that don’t require drivers to purchase bodily injury liability, or BI, insurance.

Bodily Injury Liability Insurance

Bodily Injury Liability Insurance

Beyond Florida, most states require bodily injury liability insurance to pay for other people’s medical bills and lost wages when you’re at fault in an auto accident. BI coverage only covers other people, not you, but it can cover legal fees if you’re sued after causing the crash. BI liability insurance comes in two varieties: combined single limit and split limit policies. Combined single limit coverage carries up to a certain amount that you can divide between bodily injury and property damage protection. A split limit policy will be indicative of the limit per person and the limit per accident, as well as the maximum amount covered for all involved in the crash.

The potential repeal of Florida’s no-fault law would end the required PIP coverage, with a bill out of the state’s House offering drivers to carry a BI auto insurance policy at limits of $25,000 per person and $50,000 per accident to cover injuries to others in a wreck. The hope is to reduce insurance rates for the average driver while increasing coverage. The Florida Senate has come forth with their own bill looking to repeal and replace the no-fault system, requiring Florida drivers to purchase BI coverage at $20,000 per person and $40,000 per accident.

Personal Injury Protection

Personal Injury Protection

While there is concern over the effectiveness of no-fault insurance laws, personal injury protection, or PIP, coverage is a required minimum in most of the United States. PIP insurance generally covers medical expenses from a car accident, as well as replacement services for things you can’t do for yourself or your family because of injuries. This auto insurance coverage protects you and the people in your car, no matter who is at fault.

The goal of personal injury protection policies is to offer up prompt payment to cover medical care. Each state sets its policy limits with auto insurers for drivers to have on the road protecting policyholders injured as a result of the accident. While no-fault insurance policies may leave people susceptible to lawsuits, it’s important for drivers and vehicle owners to have all the required insurance coverage they need behind the wheel.

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