Insurance Industry Challenges Temporary PIP Injunction

September 23, 2013

The 1st District Court of Appeal heard arguments last week from the Office of Insurance Regulation to remove a temporary injunction from a lower court against HB 119, passed in 2012. The law allegedly aimed at reducing personal injury protection (PIP) fraud and lowering auto insurance rates, effectively excludes the services of massage therapists and acupuncturists from coverage under PIP insurance.

The law retains the $10,000 cap on PIP coverage, but caps non-emergency care at $2,500. It also cuts out massage therapists and acupuncturists from receiving claims, and requires claimants to seek medical care within two weeks of an accident. The insurance industry has argued that since the new law has gone into effect, PIP Insurance rates have dropped by as much as 25%. Interestingly, since the new law went into effect, several auto insurance carriers have filed for premiums increases, especially smaller carriers.

The temporary injunction entered in April, 2013 was the subject of last week’s hearing. Proponents of the new PIP law contend that the injunction has held up reforms and delayed their ability to do what was intended to curb fraud benefit consumers with lower premium rates.

With the status of Florida’s PIP statute in limbo, there is new legislation being pushed to eliminate PIP coverage all together in favor of mandatory bodily injury coverage, which pays out larger amounts but only for those not at fault in a motor vehicle accident. This may be brought back before the legislature in next year’s session. The Court has not set a time frame for ruling on last week’s hearing so it could be a long time before any decision is returned.

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