OAI: Fla. Arrests Put Another Spotlight on PIP Car Insurance Reform

    RANCHO CUCAMONGA, CA, March 28, 2012 /24-7PressRelease/ -- Recent arrests linked to insurance crimes involving food truck operators who staged accidents in Florida serves as a timely example of the types of PIP abuse a recent push by that state's lawmakers targeted, reports Online Auto Insurance.

Earlier this month, Florida legislators finished long-term wrangling over how to reduce ballooning costs surrounding its "no-fault" insurance law, which compensates policyholders for medical expenses incurred after a collision. The proposed changes included HB 119, approved March 9, are awaiting final approval from Gov. Rick Scott.

Just last week, authorities arrested 14 men and women in Miami they say perpetrated a two-year racket of recruiting people to pose as food truck owners and stage accidents; another arrest linked to the swindle was reported this week and more are expected.

The arrests were lauded by Florida Chief Financial Officer Jeff Atwater, who added that arrests for personal injury protection (PIP)-related crimes made by a state enforcement agency he leads jumped 44 percent from 2010-11, with 166 such arrests made so far in 2012.

Consumers making a state-by-state auto insurance rate comparison may find higher rates in places like Florida, where its consumer advocate put the cost of PIP-related crimes to coverage at $1.4 billion since 2008. The Insurance Information Institute estimates that policyholders paid $58 more per vehicle in Florida in 2011 because of no-fault crimes, signifying a 7-percent jump in the cost of such crimes since 2010.

Recent revisions brought by HB 119 were meant to curb those costs by making long-form police reports necessary more often and instituting other anti-abuse measures.

Coverage costs should also be cut by other big changes to the state's system.

One of the most major changes is requiring that coverage of medical expenses up to policies' $10,000 limit be related to an "emergency medical condition," which lawmakers defined as an injury that could seriously jeopardize health if left untreated; PIP coverage previously covered that dollar amount but did not include the "emergency medical condition" requirement.

Another change mandates that policyholders seek medical treatment within 14 days of an accident, while another narrows the types of covered medical treatments. Florida's consumer advocate reported that billings for massage and therapeutic exercise are currently the most commonly billed procedures in the PIP system; massage and acupuncture therapy were eliminated as covered treatments under the latest version of HB 119.

The legislation's latest form also widens the abilities of police and insurers to investigate suspected criminal activity: police would note details of accidents in a longer form of reporting and insurers have 60 more days to investigate allegedly phony claims. HB 119 will also, if approved, further limit the types of hospitals, clinics and other healthcare facilities that can be reimbursed with PIP payouts.

Source: http://floridasenate.gov/Session/Bill/2012/0119

OAI recommends that motorists be mindful of which medical treatments their insurer covers and the amount of time they have to seek treatment. With efforts at PIP-related reform varying from state to state, motorists face a patchwork of coverage types and payouts.

To learn more about this and find state-specific rates, go to http://www.onlineautoinsurance.com/compare/ where you can utilize an easy-to-use quote generator.

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