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Insurance Consumer Advocate

Sha'Ron James

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Mailing: 200 East Gaines St.
Tallahassee, FL 32399-0308

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Florida Gov. Scott Signs 'Milestone' PIP Reform


By: Chad Hemenway


Florida Gov. Rick Scott has signed what the industry is calling the “most significant auto insurance law in decades.”

Scott signed HB 119, which aims to mend the state’s broken no-fault, personal injury protection (PIP) system—a system the insurance industry for years has said is plagued by abuse and fraud, costing Floridians more than $1 billion annually.

Samuel Miller, executive vice president of the Florida Insurance Council, says the new law is the most substantial one in decades because it will “reduce fraud and eventually bring down auto insurance rates.”

With pen in hand, Scott was flanked today by Insurance Consumer Advocate Robin Westcott and Insurance Commissioner Kevin McCarty at the Northeast Florida Law Enforcement Training Criminal Justice Center in Jacksonville, Fla.

While letting out what seemed like a collective sigh after a long and hard-fought battle, the industry roundly praised the measure—which looks to reduce frivolous lawsuits, reduce staged accidents and shut down fraudulent medical clinics.

The American Insurance Association (AIA), like other industry representatives, says stopping PIP fraud has been one of its top priorities. Ray Farmer, Southeast regional vice president for AIA says the association is “pleased that policymakers addressed this crucial issue and accomplished this important milestone for Florida motorists.”  

The PIP debate “was a tumultuous fight,” says Paul Blume, senior vice president of state government relations for the Property Casualty Insurers Association of America (PCI). But the industry had strong backing this year in the governor, insurance commissioner and Chief Financial Officer Jeff Atwater.

With the new law, “Florida will release the chokehold that fraud has on Florida’s insurance consumers,” says a statement from Atwater, who acknowledges the contribution of bill sponsors Rep. Jim Boyd, R-Bradenton, and Sen. Joe Negron, R-Stuart. “The road to reform was a long and challenging one.”

Miller and Blume say HB 119 did not contain everything on the industry’s PIP-reform wish list, but it is a “significant step forward to address systemic cost-drivers after many years of rampant auto fraud in Florida’s no-fault system,” says Blume in a statement.

HB 119 requires claimants to seek treatment within 14 days of an accident from a hospital or physician. The bill bans treatments from acupuncture and massage facilities.

The bill also limits attorneys’ fees, establishes stiff penalties for doctors who commit fraud, and requires that claimants submit to an examination under oath from insurers.

However, insurers in the Sunshine State remain wary of other provisions in the new law. An outside consultant will be examining the predicted savings to insurers, and insurers are instructed to make a rate filing by Oct. 1. The filing must include a 10 percent rate reduction, or it must include a detailed explanation of why the mandated reduction was not met.