Insurance industry and medical lobbyists oppose bill that eliminates Florida's no-fault auto-insurance

Florida's no-fault automobile insurance laws would be junked and replaced with a fault-based system under a bill overwhelmingly approved by a House panel Thursday morning.

Insurance industry and medical lobbyists oppose the bill, HB 1181 arguing the change in law would increase automobile insurance costs for so-called "street legal" drivers, or those who carry the minimum coverage required by law. The increases could cause some to drop coverage, meaning more uninsured drivers and more strain on Florida's health care delivery system.

But bill sponsor Rep. Daniel Alvarez says the existing system, which bans injured parties from bringing lawsuits against at-fault parties to recover noneconomic damages (although there are exceptions if a person suffers a permanent loss of an important bodily function; a permanent injury; a permanent scar or disfigurement; or death) is not fair to Florida residents who are injured in car accidents that are not their fault.

Florida drivers are required to carry $10,000 in PIP coverage plus $10,000 in property damage liability insurance. Those are minimum requirements and drivers can purchase additional coverage. According to the Department of Highway Safety and Motor Vehicles, just under 6% of drivers on Florida roads were uninsured as of February.

HB 1181 would drop the PIP mandate and increase the minimum bodily injury liability coverage limits from $10,000 per person and $20,000 per incident to $25,000 per person and $50,000 per incident.

"This is an insurance that affects every single person. And if something goes up, it will be temporary in my mind's eye," Alvarez said.

"The doctors are not the enemy. The medical providers are not the enemy. Their concerns are real. There will be a learning curve and some growing pains. But you can't ask me to forgo your growing pains to continue to allow Floridians to be subject to the pain. I won't do it and I'm asking you not to."

Tampa Bay attorney Joshua Lipton argued that PIP discriminates against motorcycle drivers, who are precluded from purchasing PIP policies because no-fault statutes apply to motor vehicles with "four wheels or more."

"Not a single motorcyclist in here can purchase a PIP policy on his motorcycle," he said, referring to the many motorcyclists who trekked to Tallahassee to attend the committee meeting.

The situation is exacerbated if a motorcyclist gets involved in a wreck with "street legal drivers."

"There's nothing there for their lost wages, there's nothing there for their pain and suffering, there 's nothing there for their medical expenses. They are thrown onto the public dole because they are hoping for emergency Medicaid. They are hoping for a charitable write-off of a hospital. None of those things are working for bikers," Lipton said.

What about the rates?

A Forbes analysis of automobile insurance rates shows that Florida is the most expensive state for car insurance in the nation. But insurance lobbyists testified that rates are going down.

State Farm lobbyist Mark Delegal said PIP has been a recurring debate in the Florida Legislature.

"For years, around this building there was a fix PIP or flush it. And there were efforts to flush it. But guess what, members? Under your leadership you have finally fixed PIP," he said, referring to sweeping changes made by the Legislature in 2022 to how lawsuits are filed and litigated and the elimination of one-way attorney fees.

Delegal said that State Farm has in the last six months lowered its automobile insurance rates by 8%. "That's a fact. That's a fact," he said.

Been there done that

The Legislature agreed in 2021 to repeal the no-fault system and the minimum mandated coverages and return to a fault-based system, but Gov. DeSantis vetoed the bill (SB 54). In his veto letter, DeSantis that although the "PIP system has flaws," repeal could have unintended consequences for the market and the consumer.

The 2021 bill would have required insurers to offer medical payments coverage, known as "MedPay," at limits of $5,000 and $10,000, but the 2025 legislation does not, so it's not clear how by how much auto rates could increase.

Nevertheless, DeSantis earlier this month indicated he doesn't support repeal, in part because it is supported by the Florida Justice Association, which represents trial attorneys.

"If they have a reform where we can show that it's going to lower rates, it's fine. But let's just be clear. I mean, you know, we know that's something that people from the legal and the trial bar have wanted to do," DeSantis told reporters on the opening day of the 2025 session.

"And so, why would they want to do that? Obviously, they see that there's opportunities for them to make money off of it." He added, "I don't want to do anything that's going to raise the rates."

Sen. Erin Grall, sponsor of SB 1256, (the Senate companion bill) isn't dissuaded by the governor's comments.

"I think there are different things that have happened since the last time he vetoed it." Grall told the Florida Phoenix. "A responsibility-based system to me is just consistent with many of the principles that he stands for. And so, I'm hopeful that we can figure out how to have an open conversation about it this session."

HB 1181 heads to the House Insurance and Banking Subcommittee next and then onto the House Judiciary Committee. Its Senate counterpart, SB 1256, has been referred to three Senate committees but heard by none.

Florida Phoenix[email protected]