PIP repeal killed in Senate as sponsor says foes ‘lying’ about rates

A Florida Senate panel voted down repeal of the state’s no-fault car insurance system Wednesday as opponents warned of massive rate hikes and the bill’s sponsor, a former chamber president, bluntly accused them of “lying through their teeth.”

Sen. Tom Lee

“These people don’t care about the rate increases that they’re lying through their teeth are going to happen,” said Sen. Tom Lee, R-Brandon. “I think a lot of the information you’re hearing today is not really honest.”

Instead this became a proxy fight about lawsuit reforms that have stalled for years in the legislature, not about repealing Florida’s no-fault system, Lee told the Senate appropriations subcommittee on health and human services.

The Florida House passed 88-15 a  bill that repeals the state’s requirement drivers buy $10,000 of Personal Injury Protection to cover the driver’s own injuries in an accident. HB 19 requires drivers to buy bodily-injury liability coverage, as all but two other states do.

A state-commissioned actuarial study found House-style repeal would save drivers $81 per car or 6.7 percent on average overall bills.

Florida drivers pay among the nation’s top six average premiums and PIP rates rose up to 54 percent among the state’s top 25 insurers in 2017, and on average 35 percent faster than overall premiums, The Palm Beach Post reported.

Though PIP was designed to avoid litigation, PIP lawsuits rose to a record of more than 60,000 in 2017, jumping close to 50 percent in one year, the Post reported. Lee mentioned that statistic Wednesday.

But the 6-1 vote in the Senate panel all but extinguishes repeal hopes for another year.

The Senate version, SB 150, required drivers to buy $5,000 of medical payments coverage, which doctors and hospitals wanted but opponents called recreating PIP under another name and wiping out driver savings. Still, keeping alive the Senate bill offered a chance to negotiate with the House.

Brad Nail, a senior manager for insurance and public policy for ride-sharing company Uber, said states that persist with no-fault systems are consistently “plagued with higher costs.”

“Voting for the bill keeps alive the hope for consumers of a better auto insurance system,” Nail told senators.

Insurance and medical lobbyists found an ally in Florida Insurance Commissioner David Altmaier.

“We are respectfully and regretfully opposed,” Altmaier said.

Asked by a legislator who said she heard rates would go up 71 percent in Broward County after repeal, Altmaier let that assertion stand. He spoke exclusively about a subset of drivers that represent about 7.6 percent of drivers in the county, according to the Pinnacle Actuarial Resources Inc. report. They buy only the state-requirement minimum including $10,000 of Personal Injury Protection to cover a driver’s own injuries in an accident, meaning they have no coverage to take responsibility for injuries they cause to others.

“It’s a reasonable assessment,” Altmaier said.

He chose not to mention savings the Pinnacle study projected for the vast majority of drivers under the House bill or any savings from eliminating recurring PIP fraud in a system designed to make payments almost automatic. Most Florida drivers have health insurance such as Medicare or employer plans that means they do not need PIP in the first place, yet they are forced to pay for its rate increases each year.

“PIP is worthless,” driver Leo Solar of West Palm Beach, who has Medicare, said. “It’s just like throwing your money away.”

The six-month PIP premium Solar paid last November was $249.30, the Post reported, It has climbed more than 40 percent from the $175.46 he paid in November of 2015.

But to hear insurance lobbyists talk, the real problem was what would happen if PIP were repealed.

Michael Carlson, president of the Personal Insurance Federation of Florida, representing insurance companies covering about 4 million Florida drivers, asserted even the Pinnacle study projected higher rates.

“Everyone concludes there will be some rate increase for Floridians,” Carlson said.

So the news for Florida drivers was forget about relief from paying some of the nation’s highest rates, as a roomful of industry lobbyists converged to smother repeal hopes.

Lee said he felt like a man who had to managed to “kick the top off an anthill.”

 

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