State Report Shows Lower Premiums After PIP Reform

Jan 24, 2014

Credit Wonderlane via Flickr

No-fault car insurance is getting cheaper in Florida. The portion of coverage known as personal injury protection, or PIP, is estimated to come down 13 percent overall this year.

A Florida law passed in 2012 was designed to reduce rampant fraud in the no-fault insurance market, potentially leading to lower premiums. A report from the state Office of Insurance Regulation suggests rates will continue to drop as insurance companies pay fewer claims.

Donovan Brown with Property Casualty Insurers Association of America says a lawsuit hampered the state’s efforts to implement the reforms.

“There’s been litigation hanging out over the insurance industry’s head over the last year to challenge the 2012 PIP reforms," Brown said. "But we see the report as a positive indicator that the PIP reforms - once fully implemented and given adequate time to work - may continue to provide Floridians with much needed relief.”

Providers of non-traditional medical treatment like acupuncture and massage therapy are challenging the law. Their services were the worst offenders for fraudulent claims and are no longer reimbursable under PIP.

A lower court lifted an injunction that delayed PIP reform, and now the case is being appealed to the Florida Supreme Court.