House Tees Up No-Fault Insurance Repeal

By Jim Turner
The News Service of Florida

THE CAPITAL, TALLAHASSEE, April 18, 2017......... A move to repeal Florida's no-fault auto insurance system could receive approval Wednesday from the House, though it remains unclear whether lawmakers can agree on the issue before the scheduled May 5 end of the legislative session.

The House on Tuesday took up the measure (HB 1063) and positioned it for a vote. Sponsor Erin Grall, R-Vero Beach, said the change is needed as 2012 reforms to the decades-old system have failed to lower rates and reduce fraud.

The no-fault system requires motorists to carry personal-injury protection, or PIP, coverage to help pay medical bills after accidents.

"It is my belief that we need to shift to a system in which people are held personally responsible for the damage that they cause on the road," Grall said. "I understand that it's a big change. However, our attempts to fix PIP have not reduced the fraud, have not fixed the system, and have actually provided less coverage at a higher cost."

Still, obstacles remain for the proposal, which would replace mandatory PIP coverage with more-expensive bodily injury coverage. Most Florida drivers already have bodily injury coverage.

The Senate has just started to advance a separate measure (SB 1766) that would gradually impose a higher minimum of bodily injury coverage and require medical-payments coverage, similar to a component in no-fault that Grall has called "PIP renamed."

Also, Senate Appropriations Chairman Jack Latvala on Monday said eliminating Florida's the no-fault system would likely favor trial lawyers at the expense of insurance companies and "maybe" consumers.

Under the no-fault system, motorists are required to carry $10,000 in personal-injury protection coverage. That coverage essentially hasn't changed since 1979.

Under Grall's proposal, motorists as of July 1, 2018, would have to get at least $25,000 in coverage for bodily injury or death and $50,000 for bodily injury or death of two or more people.

The Senate version, which cleared the Senate Banking and Insurance Committee last week, would require, starting in 2018, a motorist to have $20,000 in personal bodily injury coverage and $40,000 for multi-person bodily injury coverage. The minimums would grow two years later to $25,000 and $50,000 and to $30,000 and $60,000 in 2022.

The House legislation is projected to save motorists an average of about $81 a year per policy. But that is mostly due to the fact that nearly 90 percent of motorists already have some form of bodily injury coverage. The savings would also depend on where motorist lives.

The change could also cause health-care premiums to rise about 1.5 percent, Grall acknowledged.

The Senate proposal is projected to save motorists $9 to $12 a year, depending on where people live.