In Florida, the state’s legal insurance requirements include personal injury protection. Only 10 states require PIP, which is no-fault insurance. The motivation for lawmakers to do this was to help you and other drivers who may end up in a serious accident requiring medical coverage. However, in recent years, a problem with PIP developed that required some adjustments to the law.

The Florida Office of Insurance Regulation explains lawmakers initially enacted the PIP requirements to ensure that you would have access to at least $10,000 for medical care right away after an accident. Without PIP, you would have to go through the court system to establish fault and perhaps deal with insurance companies to prove fault before you could get any money. The hope was to lessen the burden on the courts.

The abuse

The problem with requiring PIP is that even though the number of accidents did not increase, the number of PIP claims increased significantly. This indicates that there were likely a large number of fraudulent claims occurring, which costs the industry as well as consumers, like you, money.

A new law

To combat this issue, lawmakers enacted another law addressing PIP fraud. This is important because fighting fraudulent claims means that when you make a legitimate claim, it will cost you less and can help you to avoid hassle when trying to receive payment for your medical needs related to the accident. The law put into place new requirements for crash reports and also for medical providers benefiting from PIP claims. It went into effect in 2012.

Since those changes in the PIP laws, lawmakers keep monitoring PIP claims. One analysis of the effects of the changes concerning PIP shows that it seems to be helping to reduce fraud as well as helping to lower costs at least a little for people like you who are buying PIP polices.