Laws involving things like injury from automobile accidents and coverage in automobile insurance should not be “gotcha laws”. But, that is what the new personal injury protection laws which took effect on July 31st will do.
Last year, Florida’s governor and legislators championed a revision to Florida’s “Personal Injury Protection” (PIP) laws under auto liability insurance statutes. The insurance industry complained to the legislature that they were suffering rampant fraud in the PIP industry and needed this relief or they would go out of business, the sky would fall or life as we know it would end. Effectively what they have done for consumers is to create stumbling blocks to coverage and for insurance companies they have drastically reduced the potential exposure when consumers suffer injuries in automobile accidents.
Traditionally, PIP provided up to $10,000 coverage to drivers and passengers of vehicles involved in accidents. The idea was to allow payment of a set amount of money for the treatment of injuries, regardless of fault. That way, consumers were able to seek and pay for injuries they suffered in auto crashes.
The new law provides you only $2500 of the $10,000 PIP limits if you do not present to an emergency room within 14 days after the accident and receive a diagnosis of “an emergency medical condition”. What is an “emergency medical condition”? The law does not clearly set forth exactly what that means. Is a herniated disk that has not begun to exert pressure on nerves or the spinal cord represent an “emergency medical condition”? What if that herniated disk further herniates on day 15 and begins to compress the spinal cord?
In addition, although recognized by physicians in the U.S. and in many other countries as highly effective treatments, acupuncture and massage therapy will no longer be covered at all under the new law.
What did insurance companies promise to do in exchange for these unfair restrictions on PIP coverage? They were supposed to reduce auto insurance/PIP premiums by at least 10% in the first year. Insurers were supposed to file rates by January 1, 2013 that reflected a 10% reduction.
What did insurance companies do? Many have already filed for rates that show no reduction and in some cases, have filed for rate increases. Insurers have claimed that the lack of reduction is really a reduction; because without the new PIP law they would have filed for substantial rate increases.
We get to pay a premium for PIP coverage that is calculated on $10,000 in coverage; while only receiving $2500 in coverage if we do not immediately rush to an emergency room and get lucky enough to have an “emergency medical condition” that actually gets diagnosed.
We get to pay a premium for $10,000 in coverage that is no less cost than it was before Florida legislators and the governor squandered away our rights under PIP insurance contracts.
So, consumers get a “gotcha” when they find out they only have $2500 coverage for what evolves into a serious medical condition.