Powered by Topple

Car insurance reforms need more time to work as intended, industry says

Powered by Topple

Reforms passed in 2012 have put Florida on the road to curbing an estimated $1billion in fraudulent auto insurance claims if they’re given a chance to take hold, insurance executives said.

Senate Banking and Insurance Committee David Simmons, R-Altamonte Springs, held a hearing Tuesday on the future of the state’s no-fault car insurance system – known as Personal Injury Protection – and whether it should be replaced.

carcrash1106But a recent appeals court ruling that threw out a challenge to the 2012 reforms means they have a chance to start working the way they were intended, insurance executives said Tuesday.

“After years of rampant fraud and abuse in Florida’s no-fault system, bold steps were taken in 2012 to enact reforms that are intended to stop criminals from exploiting the system and hurting Florida’s honest, hardworking consumers,” Donovan Brown, state government relations counselor for the Property Casualty Insurers Association of America said in a statement after the hearing.

“It is crucial to do whatever it takes to combat the fraud and abuse and stop the $1 billion fraud tax on Florida consumers,” the statement said.

“If given time to work and be fully implemented, PCI and its members are cautiously optimistic the reforms could provide Floridians with much-needed relief.”

Michael Carlson, executive director of the Personal Insurance Federation of Florida, agreed.

“There’s some very, very initial trend data showing that some claims are decreasing,” Carlson said, according to the News Service of Florida. “It seems to indicate some of the costs in the system are being addressed.”

On Tuesday, Rep. Carlos Trujillo, R-Miami, filed two bills to overhaul the car insurance system by replacing the no-fault insurance system with bodily injury coverage, according to the News Service of Florida.

Simmons is considering a similar measure, according to the News Service of Florida, but noted that he insurance industry had been encouraged by the appeals court ruling to give the reforms another chance.

Still, the Oct. 23 appeals court decision hinged on the legal standing of parties involved rather than the merits of the challenge. That could mean court trouble in the future for the 2012 reforms, Simmons said, according to the NSF.

“That 1st DCA opinion, decision provides no solace to an insurance company who is trying to deal with PIP,” he said, according to NSF. “As someone told me, it’s just a stay of execution.”


Latest Articles