| What is Florida no fault insurance? What exactly is | | | | was considered, the plan to tax gas in order to |
| no fault insurance in the first place? Where is it | | | | fund no fault was defeated. Legislature in many |
| available and what are its advantages and | | | | forms was even introduced at the Congressional |
| disadvantages? If you life in FL and have | | | | level but it never made it to a vote. |
| questions about how the Florida no fault car | | | | HOW DOES NO FAULT WORK? |
| insurance laws work or really if you live in any | | | | The 'no fault' part of an insurance plan is usually |
| one of the twelve states that use a no fault | | | | called PIP, Personal Injury Protection, or it is |
| system, knowing the answers to these questions | | | | sometimes referred to as OBEL, Optional Basic |
| will help you understand how your car insurance | | | | Economic Loss. Different state's PIP's cover |
| policy works. Read on to learn some of the basics | | | | different aspects associated with personal injury. |
| of no fault car insurance in Florida and in other | | | | Generally, the coverage is related to medical |
| states. | | | | expenses, loss of wages, and compensation for |
| WHAT IS NO FAULT INSURANCE? | | | | loss of services incurred because of an auto |
| Under 'pure' no fault insurance each driver would | | | | accident. Funeral costs and death benefits are also |
| be completely covered by his own auto insurance | | | | usually covered. |
| (up to his policy limit), and drivers would be barred | | | | STATES THAT HAVE NO FAULT INSURANCE |
| from suing another driver regardless of the | | | | LAWS |
| severity of the accident, the injuries incurred and | | | | MI, NJ, NY, PA, HI, KS, KY, MASS, MI, ND, UT, |
| even if a death were involved. | | | | and DC and Puerto Rico have a no fault insurance |
| However, no state uses 'pure' no fault insurance. | | | | system. Florida's no fault insurance expired Oct. 1, |
| In general, no fault is an auto insurance system in | | | | 2007 but was re-enacted in Jan of 2008. |
| which both drivers must carry insurance for their | | | | However, when the system was re-instated, |
| own protection, and their ability to sue other | | | | significant reforms to curb fraud were added. This |
| drivers for damages is regulated by certain | | | | may have been due in large to a letter sent by |
| limitations. States impose these limitations by | | | | Chief Financial Officer Alex Sink in July of 2007 to |
| determining which cases are permitted to go to | | | | the Governor and state officials. This letter stated |
| litigation. | | | | that more than 3,000 complaints about PIP fraud |
| Under this system, motorists may sue for severe | | | | had been received in the last twelve months and |
| injuries and pain and suffering. Some states MI, | | | | 329 cases were opened with 225 convictions |
| NJ, NY, and PA use a verbal threshold system, | | | | being obtained. Under the former system, |
| where the severity of the injury is defined in | | | | unscrupulous medical clinics and attorneys could |
| verbal terms (verbal threshold). Other states use | | | | run up medical costs for minor accidents. |
| a monetary threshold, a set dollar amount in | | | | The following states had no fault Insurance in |
| medical bills and lost wages that must be met | | | | place at one time and chose to repeal it, with the |
| before a motorist may sue for damages. Insurers | | | | exception of Pennsylvania who repealed theirs and |
| generally favor laws that provide for a verbal | | | | then reenacted it. |
| threshold on suits instead of a dollar threshold. | | | | Nevada: - effective 1974 - repealed 1980 |
| Setting dollar targets for medical expenses may | | | | Pennsylvania: - effective 1976 - repealed 1984 - |
| encourage the submission of fraudulent claims in | | | | reenacted 1990 |
| an effort to reach the total dollar amount | | | | Georgia: - effective 1975 - repealed 1991 |
| whether the expense it justified or not. | | | | Connecticut: - effective 1973 - repealed 1993 |
| WHY THE NEED FOR NO FAULT INSURANCE? | | | | Colorado: - effective 1974 - repealed 2002 |
| The desire for a new way of handling auto | | | | WHAT ARE THE BENEFITS OF NO FAULT |
| insurance claims rose out of a dissatisfaction with | | | | INSURANCE? |
| the way in which insurance claims were | | | | No fault is intended to reduce legal and |
| processed. This dissatisfaction was not only on | | | | administrative fees that are associated with |
| the part of those purchasing auto insurance, but | | | | insurance claims and reduce premium costs. Also, |
| also on those companies and agencies marketing | | | | the long delays associated with determining which |
| auto insurance and the state officials regulating it. | | | | party is at fault and the haggling between |
| The issue focused on the often expensive and | | | | insurance companies over who is financially |
| time consuming process of determining who was | | | | responsible is done away with. This plan also |
| at fault in the accident and who was legally and | | | | insures that no matter who is responsible for an |
| financially responsible. | | | | accident each party will be covered to his policy |
| The delays in determining liability caused legislation | | | | limit. |
| to be introduced in many states in the 1970's that | | | | CRITICS OF NO FAULT INSURANCE |
| allowed victims to recover financial losses such as | | | | Critics point out that this insurance system carries |
| medical and hospital expenses and lost income | | | | some of the highest insurance premiums in the |
| from their own insurance companies. This became | | | | nation. The liability issues that still remain intact |
| a forerunner of today's no fault insurance. | | | | actually drive premium costs up. States with no |
| The concept of no fault insurance was first widely | | | | fault insurance also carry the highest incidences of |
| introduced to the public in the early 1900's. Its | | | | fraud and abuse.Another criticism of no fault |
| two main tenants, stemming waste, inequities, and | | | | insurance is that reckless or negligent drivers are |
| lengthy delays in the liability system, and providing | | | | not punished because many cases do not go to |
| affordable coverage for medical care and | | | | trial and these drivers may continue to drive |
| rehabilitation costs had its appeal among the | | | | irresponsibly. |
| populace. However, the process that was to be | | | | NO FAULT AUTO INSURANCE QUOTES |
| put into place to pay for no fault insurance was | | | | Whether you are in a no fault state or not - it is |
| anything but appealing to the voters. A pay-at-the | | | | always a good plan to shop around and compare |
| pump initiative was introduced as a way to pay | | | | car insurance quotes at least once every 6 |
| for no fault insurance by collecting a fee on | | | | months to insure that you are getting the best |
| gasoline sales. In every state in which the initiative | | | | deal. |