PIP Rings in New Year for Florida's Drivers
Florida's no-fault system returns Jan. 1, along with mandatory insurance coverages
TAMPA -Beginning again Jan. 1, 2008, all Florida drivers will need to carry Personal Injury Protection (PIP) and Property Damage coverage to comply with the law that is restoring the state's no-fault auto insurance system after a three-month lapse.
"PIP is an important consumer protection for Florida drivers and their families, and with all the distractions of the holiday season upon us, it's important for motorists to realize that this coverage will once again be mandatory-and strictly enforced by the state-starting on New Year's Day," said Dan Tarantin, CEO of Direct General Insurance Company.
Tarantin encouraged all drivers to act quickly to ensure they have the minimum mandatory PIP and Property Damage (PD) coverage in place. "Drivers have less than two weeks to comply with a law that has real teeth," he said.
Most vulnerable are drivers who elected to drop PIP coverage after the sunset of the no-fault law on Oct. 1, and drivers who purchased new policies after the sunset that didn't include PIP. Also vulnerable are drivers who simply choose to skirt the state's motor vehicle laws and go uninsured.
Under the renewed no-fault/PIP law, auto insurers will add automatically PIP to existing auto insurance policies that don't carry it now, Tarantin said. Drivers who don't currently carry PIP will be charged the additional premium for the coverage, which by law will be based on the rates and forms that the auto insurer used prior to Oct. 1, unless new rates and forms are approved by the state. These additional premium payments are due as early as Jan. 1, 2008.
"While some auto insurers are filing for rate increases for PIP coverage," Tarantin said, "effective Jan. 1, Direct General will reduce its PIP rates for new and renewal policies."
Auto insurers are also legally required to submit daily reports to the Florida Department of Highway Safety and Motor Vehicles (DHSMV) regarding any policy cancellations, non-renewals and new policies written. This information will be used by DHSMV officials to identify and penalize drivers who are not carrying the minimum mandatory auto insurance coverage.
Penalties are steep for drivers who fail to comply. The state may suspend the driver's license and registration. The drivers may also face reinstatement fees ranging from $150 to $500.
Florida's no-fault system and mandatory PIP actually expired Oct. 1, but lawmakers reenacted the system during a special session on Oct. 5. Governor Crist quickly signed the bill into law, making the return of no-fault and mandatory PIP effective on Jan. 1, 2008.
"The reinstated no-fault system and PIP protect consumers and help reduce fraud by lowering the number of uninsured drivers on Florida's roads, providing timely medical coverage at set fees for motorists injured in auto crashes, and eliminating the delays and expense of costly litigation over auto crashes," Tarantin said.
PIP is an especially important coverage in Florida, where an estimated one in four residents under age 65 have no health insurance and about 40% of all crash victims treated for injuries in Florida's emergency rooms and trauma centers have no health insurance. Without PIP, many of these uninsured crash victims could face a financial hardship if unable to pay their medical bills. "This is a complicated issue and many Florida drivers are confused about the auto coverage that they are required to have and the return of the no-fault system," Tarantin said. "The best way for drivers to protect themselves if they have questions or concerns is to contact an expert-their insurance agent. The agent can make sure they are adequately protected and are complying with Florida law."
Direct General Insurance Company is one of Florida's leading auto insurers, serving more than 150,000 policyholders. Through its affiliate stores, Direct General offers auto insurance coverage under the Florida No-Fault, Cash Register and Direct General brands.
Consumers looking for more information or a nearby Florida No-Fault, Cash Register or Direct General auto insurance office should call 1-877-GO-DIRECT (463-4732).
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