No-Fault Auto Insurance Repeal Hits The Florida House

TALLAHASSEE - An attempt to end the state's no-fault auto insurance system is on the fast track in the Florida House.

As in past years, the legislation, which has been projected to save motorists an average of about $80 a year, faces opposition from some insurers, business groups and medical providers.

Meanwhile, the House and Senate are comparing different models to change the system.

The House Commerce Committee voted 18-7 on Tuesday to back a measure (HB 19) by Rep. Erin Grall, R-Vero Beach, that would end the no-fault system, which requires motorists to carry personal-injury protection, or PIP, coverage to help pay for medical care after accidents.

Under the bill, motorists would instead be required to carry bodily-injury coverage.

The change would fully open drivers at fault in accidents to liability for damages and could shift some costs to health care premiums.

"I understand that it's going to be difficult and that change is hard," Grall said. But she added that "we will have more adequate levels of coverage for the severity of accidents on our roads."

Grall, an attorney, did not want to add issues to the bill, such as increasing enforcement of uninsured motorists and making changes in the state's bad-faith laws.

Bad-faith lawsuits typically involve allegations of misconduct by insurers that handle claims and can be costly.

Grall said a number of interests are trying to make the proposal "more complicated than it needs to be."

The Personal Insurance Federation of Florida, the Florida Justice Reform Institute and the Institute for Legal Reform, an offshoot of the U.S. Chamber of Commerce, are among those that want a no-fault repeal to also address changes in the bad-faith laws.

"Florida's third-party insurance bad faith laws create a perverse incentive for persons injured in auto crashes to game the system in order to set up an insurer for a bad faith claim that could greatly exceed the amount of coverage purchased by the insured," said Michael Carlson, president of the Personal Insurance Federation of Florida.

With approval Tuesday from the Commerce Committee, Grall's bill is positioned to go to the House floor when the 2018 legislative session starts in January.

The House has considered bills annually since 2013 that would have repealed PIP, with the House passing a Grall bill during the 2017 session. The bill died in the Senate.

Under no-fault, motorists must carry $10,000 in PIP coverage, an amount that essentially hasn't changed since 1979. The system is designed to help limit lawsuits stemming from traffic accidents.

Lawmakers in 2012 passed a package of changes - championed by Gov. Rick Scott and then-state Chief Financial Officer Jeff Atwater - that were considered a last-ditch effort to maintain the system after rates increased due to an increase in fraudulent claims.

Repealing PIP would eliminate the system's limits on lawsuits. Drivers at fault in accidents would be fully liable for damages, with the minimum bodily-injury coverage under Grall's proposal being $25,000 for damages for injury or death of one person and $50,000 for injury or death of two or more people.

In the Senate, Thonotosassa Republican Tom Lee is sponsoring a measure (SB 150) that differs in the way it would revamp the system. Among the differences are in the levels of required bodily-injury coverage.

With the House bill ready for the floor, Grall said she hopes to have time to talk with Lee about their conflicting proposals.