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Insurers predict significant savings for consumers on PIP auto coverage

4:52 PM, Aug 22, 2012   |    comments
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TALLAHASSEE, Fla. -- You can expect a reduction of 14 percent to 25 percent on the PIP portion of your auto insurance bill, according to a new report.

However, it looks as though it will be at least another year before you get any savings on your personal injury protection coverage.

The new law is designed to cut down on accident fraud. That fraud is estimated to cost Florida drivers an extra $1 billion a year.

The law requires a decrease of 10 percent in PIP rates by this October and 25 percent by 2014. The PIP portion of your auto bill represents about 20 percent of the overall premium.

Sam Miller of the Florida Insurance Council, which lobbies for insurers, says PIP rates will eventually come down.

"Auto insurance rates were hemorrhaging out of control and it was fraud and we passed it and now we need to implement it in an effective way and it will produce very significant savings for consumers."

But the key parts of the new law don't take effect until next January, so you probably won't see rate reductions until 2014.

"Since the heart of the bill has not yet taken effect, it only makes sense that the real savings will be reflected in that second filing that will be made a year after the key reforms were first in effect."

If insurance companies fail to pass on the targeted savings for drivers, then the law requires them to document why they can't.

The key parts of the law taking effect in January include a limit of $2,500 for non-emergency treatment, a requirement to seek treatment within 14 days after the injury and a ban on such treatments as massage therapy and acupuncture.

First Coast News

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