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Florida A Step Closer To Eliminating No-Fault Insurance

Matthew Peddie/WMFE

An effort to end the state’s no-fault auto insurance system traveled back to the Senate on Monday after the House approved a tweaked bill.

The House voted 99-11 to support the proposal (SB 54), which includes ending a requirement that motorists carry personal-injury protection, or PIP, coverage.

The bill would make bodily-injury coverage mandatory.

The Senate already approved the bill, but the proposal is going back over a difference about medical-payments coverage — known as “med-pay.” The Senate approved requiring motorists to carry $5,000 in med-pay coverage.

The House wants to give motorists an “opt out” choice on $5,000 to $10,000 in med-pay coverage.

Revamped in 2012 to try to reduce fraud in the system, no-fault has since 1979 required motorists to carry $10,000 in PIP coverage to help pay for health-care costs after accidents.

The proposal would set minimum bodily-injury coverage at $25,000 for the injury or death of one person in an accident and $50,000 for injuries or deaths of two or more people.

House sponsor Erin Grall, R-Vero Beach, said Monday the change would save money for most drivers — primarily people who already have bodily-injury coverage.

“The $10,000 policy was set back in 1979. Forty-plus years later, the purchasing power of that $10,000 has eroded by 86 percent and is worth approximately $14,000 today,” Grall said. “In other words, PIP coverage would have to be about $72,000 to provide the same level of medical coverage that Floridians would have received in 1979.”

Several Democrats have expressed concern that the plan would drive up premium costs for low-income Floridians who already struggle to make payments.

Lobbyists for the insurance industry have warned that updated actuarial numbers are needed.

A 2016 report by the Florida Office of Insurance Regulation projected drivers on average would see a 5.6% savings with a shift to a bodily-injury coverage requirement. But a 2018 study by the actuarial consulting firm Milliman showed a potential average increase in premiums of $67, or a 5.3% increase.

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