Topic: Essential Automobile Insurance Coverage in Florida

Florida is considered a "No Fault" state, because Florida law requires by law anyone with an automobile registered to them to carry "No Fault" automobile insurance or to have other, equivalent security, such as a large sum of money set aside, to pay for any potential lawsuit against you for causing an automobile accident that causes damages some innocent party's vehicle (PD) and pays for your own medical expenses, lost wages, mileage expenses to medical care and prescriptions if you are injured (PIP), regardless of who was at fault for the accident.

Your own insurance pays for your own medical expenses regardless of who caused the accident. The coverage in your policy that covers your own above listed expenses is called "Personal Injury Protection" or "PIP" for short, which is often used interchangeably with "No Fault" coverage. The insurance company is not allowed to increase your insurance premium for making a claim under the PIP portion of your policy unless you were at fault for the accident, and since most people are so shaken up by an accident that they don't really know whether or not they are injured, we recommend you get checked over by a doctor as soon as possible after the accident occurs. Call our office for the name of a doctor who will give you high quality, friendly, care and who is not afraid to be involved in litigation should your injuries turn out to be serious enough to require a lawsuit in the future.

Florida law requires you to have $10,000 in PIP limits and $25,000 in PD limits. Although many vehicles can be repaired or replaced for $25,000, I'm sure you instantly think of some vehicles that cost far more than that. Should you be unlucky enough to cause an accident where the other party's vehicle is worth more than $25,000 and you only have the minimum required coverage of $25,000, you can be held personally liable for the rest of the expense. Although the other party might have collision coverage to pay the balance, that insurance company is highly likely to sue you long after the accident (up to four years later) to obtain a judgment against you for that amount that was not covered by insurance, plus attorney's fees and costs to collect it.

Because some people have group health insurance, automobile insurance agents were allowed to sell PIP insurance coverage at lower rates by having you opt for a high deductible on your PIP coverage: $1,000, or $2,000, or even $8,000 on a $10,000 PIP limits policy! This way, the automobile insurance coverage for your medical and other above listed expenses would not have to pay the first $1,000 or $2,000 or $8,000 (whatever deductible you agreed to) of your expenses. Selection of a PIP deductible when you do NOT have other health insurance coverage, however, can cost you thousands of dollars when you are injured in an automobile accident, because those thousands must come out of your own pocket before PIP will pay any of your expenses. I highly recommend you opt for NO deductible on PIP if you have no other health or medical insurance, but also even if you do, and here's why:

The difference in cost of premiums for PIP with or without a deductible is not much, ask your agent for quotes for both to see. When you have a high PIP deductible, and your PIP expenses are higher than the deductible, you often have the type of serious injury that warrants a claim be made against the at fault party. When this occurs, we make a claim on your behalf to the at fault party who is indemnified by their BI (bodily injury) insurance coverage. This BI is insurance coverage they bought in case they caused an accident in which someone else (like you) were injured, to prevent you from suing them individually instead of their insurance paying you.

Although BI (bodily injury) coverage is NOT required by Florida law, it is highly recommended you carry BI coverage, because if you don't, your personal assets are at stake should you cause an accident where the other parties are personally injured. The amount of BI coverage you should carry is the highest amount you can afford. An accident can happen to any of us at any time no matter how great a driver we are. It only takes an instant. For example, you glance down at the radio or clock at the same instant the vehicle in front of you jams on their brakes hard to avoid hitting something or someone that just darted out in front of their vehicle. Your reaction time is slower than otherwise, because you weren't looking at the road at the moment. Rummaging for cigarettes, or make up, or your cell phone take even longer and make your time to react to avoid the accident even shorter. So the front of your vehicle hits the back of the vehicle in front of you. Your PD coverage will pay for their vehicle damages or replacement up to $25,000; your PIP coverage will cover your medical, lost wages, etc. up to the limits you have selected, after any deductible, and importantly, your BI will apply to pay the cost of the other party's pain and suffering, mental anguish, loss of the enjoyment of life, etc. Sure, his PIP coverage will pay his medical expenses and lost wages, but what is not well known is what goes on "behind the scenes". When his PIP pays his expenses, his insurance company sees that you caused the accident, they sue you to reimburse them! That is, unless you have BI insurance sufficient to cover the cost. Buy the highest amount of BI insurance you can afford, because medical care is very expensive, and $10,000 can be consumed in just one emergency room visit, and many people need far more than an emergency room visit.

Another very important coverage, not required by law, but well worth having, is uninsured / underinsured motorist coverage. Let's say you have plenty of PD, PIP, and BI coverage, but no uninsured motorist coverage, and someone causes an accident that results in severe bodily injury to you. Although (typically 80%) of your medical expenses will be paid up to the amount of coverage you bought under PIP, nothing will be paid for all the pain and suffering, inconvenience, mental anguish, loss of the enjoyment for life, lost earning capacity, etc. and that 20% your PIP didn't cover, UNLESS you purchased uninsured motorist coverage. UM takes the place of the other driver's BI when he doesn't have any, or he doesn't have enough BI coverage for your claim.

PIP usually pays only 80% of your medical expenses. There is an additional coverage called "Med Pay" and/or other PIP coverage that will cover the other 20%. Ask your insurance agent to give you a quote for Med Pay and 100% PIP coverage. Med Pay pays for your medical expenses that exceed the coverages purchased under PIP.

The amount of coverage you will purchase is directly weighed against what you have to lose if you don't purchase the insurance, and what you have to lose can be tens of thousands of dollars or more.

If you fail to carry BI insurance, and you cause an accident, the other party can sue you personally instead of your insurance company paying the claim for you up to your policy limits. If you have money in the bank, paid off vehicles or vessels, or other non-exempt assets, or you have income or wages, all of these are fair game for the insurance company suing you individually to garnish or attach and sell to reimburse them or pay the judgment for the other party's claim they made and were paid by insurance. A judgment is good for ten years and renewable for another ten after that. You might think you don't have much to take right now, but you might be living a lavish lifestyle 18 years from now when they sue you to take whatever you have. Play it safe. Carry as much PIP, PD, BI, UM, and MED PAY coverage as you can. When you are involved in an accident, you'll be glad you did.