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Insurance group's four-point plan for fixing PIP

The Property Casualty Insurers Association of America is recommending four fixes to the state’s no-fault auto insurance system.

The recommendations – more time to investigate suspicious claims, capping attorney fees, allowing private companies to inspect medical clinics and limiting medical treatments – would help reduce insurance fraud and ultimately save consumers money, the trade group said.

Paul Blume, Property Casual Insurers' senior vice president for state government relations, said the organization will push for changes to state law in coming months. A working group of experts, created by CFO Jeff Atwater, is studying ways to reform the system.

“By passing legislation in the upcoming 2012 legislative session that includes these four vital components, the Legislature will help close the loopholes that prevent regulators and the marketplace from investigating and fighting fraud,” Blume said. “Florida will also be able to protect its consumers and eliminate the rampant PIP fraud that is driving up the cost of insurance premiums in our state.”

Florida requires drivers to carry $10,000 worth of insurance so accident injuries are covered regardless of which driver causes the accident.

Staged accidents, needless medical tests and other abuses have driven up insurance premiums, reform advocates say. The Property Casual Insurers report said that Florida drivers pay the highest liability insurance premiums in the nation and PIP fraud has cost consumers $800 million since 2006.

This summer, Gov. Rick Scott said PIP coverage should be optional for drivers as a way to reduce fraud. Later, in a draft legislative plan, the governor’s office said reforming the no-fault laws would be a key component to accomplishing his campaign promise of tort reform.

Earlier this month, the Florida Chamber of Commerce announced its 2012 legislative agenda would include PIP reforms to cut down on fraud and abuse, calling it “a billion dollar problem that raises the cost of living for Floridians.”

Click here for a link to the press release from Property Casual Insurers Association of America, where the full report is attached.

-Tia Mitchell