PIP Coverage in Florida

Personal Injury Protection (PIP) Auto Insurance



Why is the state of Florida so strange when it comes to auto insurance?


First to be clear, in order to drive in Florida every vehicle with four or more wheels must maintain auto insurance and in order to register your car you must show this coverage. So far so good you would think..but Florida and 9 other states came up with the grand experiment of No Fault and thus was born the bare minimum requirement of $10,000 personal injury protection (PIP) and $10,000 property damage liability (PDL).

PIP was meant to make insurance easier for drivers so they made Florida a no fault state. On paper it sounds great, PIP coverage makes the individual responsible for their own injuries in an accident regardless of fault.

PIP kicks in up to provide injured drivers up to $10,000 in immediate medical coverage in lieu of establishing fault through the court system. The idea was to make it quicker and easier to get your injuries covered and best of all, reduce the amount of court claims. So how could this go wrong?

Accidents and drivers have stayed just about the same in Florida, but the amount of these quick and easy PIP claims has gone through the sun-roof!

PIP coverage has made it super easy (and fun depending on your outlook on crime) to go to your doctor and collect a quick $10k for a “neck injury.”

Sometimes its only $7500 though because your friendly neighborhood lawyer “helps you” collect the money even though the simplicity of collecting is made so easy that it seems ludicrous to even have a lawyer in the middle of this transaction. Many lawyers will not in fact take the $2500, but most will lessen your faith in humanity according to the latest statistics.

The National Insurance Crime Bureau lists Florida as having several cities reporting the highest amount of “questionable claims” nationally. While PIP premium represents roughly two percent of Florida’s collected insurance premium, this issue accounts for nearly 50 percent of fraud referrals.

Don’t forget though, PIP claim sufferers, you must seek medical treatment within 14 days of a car accident or else you waive your PIP insurance coverage.



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Other Coverage Details and Things to Consider


Most people in Florida opt to get Liability, or “Bodily Injury” Coverage – $10,000 per person, but not more than $20,000 total. This is worthwhile coverage for sure because it means that if you are injured and your medical bills are $40,000, the responsible party’s insurance is required to pay $20,000, leaving you with $20,000 in expenses to cover on your own and luckily, both the at fault driver that hurt you to the tune of $40k and you carried this coverage so the whole 40k is covered.


What is this No Fault Business?


So what does no fault even mean? Most drivers incorrectly believe that because Florida is a no fault PIP state so therefore they can’t be sued for injuries and so on they cause in an accident. But the specifics of course are specific. No silly, once the losses in the accident (staged or otherwise) exceed $10,000 and/or where someone has suffered a permanent injury you can sue the other driver. It gets a little mind numbing though..if someone really messes me up like the Tracy Morgan/Walmart accident, it doesn’t matter if its a no fault or at fault state. Walmart was or is still going to have to cut the $90 million (supposedly) check maybe less the $10k you collected from your own PIP coverage.

Collect $10k and then hit the track


We don’t hear too much about the PD (property damage) part because no one is able to collect that $10k unless they fake crash into a friend’s car. But in Florida, you still need both coverages minimally to drive.

Once you have a PIP claim though in Florida you may as well have a Scarlett letter on your back. In fact, the whole state has a Scarlett letter.

Part of the reason we got started selling auto insurance state wide is because the average premium in Florida is ridiculously high.

We have owned agencies in other states in fact like California and Texas, both of which have very low premium, so low in fact that most brokers charge an agency fee on top of the policy that the insured doesn’t know about.


How high is the agency fee? As high as they can get away with! And its totally legal.


It blows my mind that you can haggle with a client to charge a fee, but if you didn’t not many agencies would sell insurance in these other states because the premiums are just too low.

As of 2017, the average premium was approaching $1k per 6 months. So we have to be wondering as residents of this state… What the heck? A well known trade group tracks fraud for insurers and ranks California, Florida, Texas, New York and Maryland as the top five states for fishy auto insurance claims. But California premiums are 33% of the amount of Florida premiums. The difference of course is PIP.


I’m going to write a musical and call it PIP. It will cost $10,000.


Florida is extremely strict about agency fees though because they know you are already getting ripped off by the people filing these endless PIP claims that keep the chiropractor’s in Florida so busy.

However, be smart as most agencies have sold (or slid, which means snuck in) a towing package that costs the agency $7 and the insured as much as the agency can get away with. One of these so called after market towing companies is in Boca Raton maybe 3 miles from my house. They have one of the most beautiful buildings you have seen as their headquarters. That’s because they pay for so few tows.


Who Else Can Collect $10k Tax Free?


Your PIP will also cover your child, members of your household (including your nanny who has over stayed her visa), certain passengers who lack PIP Insurance as long as they do not own a vehicle.

The catch is that your homies when riding two or three deep to a Sadie Hawkins Dance who carry their own auto insurance and thus PIP will receive coverage under their own PIP for their injuries. But the PIP law also states that certain licensed drivers who drive your vehicle with your permission also can collect under your policy PIP coverage, but that sentence is a bit up to the imagination.

PIP also covers your child if he or she suffers an injury while riding on a school bus. PIP coverage protects you while in someone else’s vehicle, as a pedestrian, or bicyclist if you suffer an injury in a crash involving a motor vehicle.


So before you cash that $10k check for that pinched nerve, maybe wait a couple of days as if it goes away your insurance will be quite a bit cheaper!

But if you still want to file and avoid paying a lawyer $2500, read the image below that I got from a good law firm I found on the internet. Thanks internet!