We would like to take a moment to tell you about a problem we encounter
on a daily basis that could have a major impact on your life. The problem
is the all too common occurrence of people being victimized by uninsured
and under-insured drivers who use our roads. This problem is real and
serious. It could spell disaster for those who aren’t prepared for
an accident caused by a financially irresponsible driver.
To understand this problem, we have to start by understanding the backdrop
of Florida auto insurance law. In Florida, the only car insurance coverages
required by law are (1) Property Damage Coverage, and (2) Personal Injury
Protection Benefits (“PIP”).
Your Property Damage insurance will pay someone else for damage to their
property when you cause an accident. This includes paying for a totaled
car, or the costs of repairing a car after a wreck. It does not provide
coverage for injuries to any person’s body.
PIP insurance pays certain economic benefits, such as a portion of your
own medical bills or wage loss, regardless of who is a fault for an accident.
In Florida, PIP is limited to a total of $10,000.
One should also bear in mind that PIP does not pay 100-percent of medical
bills up to its $10,000 limit. PIP only pays 80-percent of reasonable
medical charges. That means an injured person, under the best of circumstances,
will still have to pay the 20-percent difference either from their own
pocket or other insurance sources.
Florida residents can’t even be sure that their entire $10,000 of
PIP benefits will be available. Auto insurance companies sometimes cut
off those benefits using various legal maneuvers. Often, the only recourse
one has when that happens is to file a lawsuit against the insurance company
to try and win back the terminated benefits. This can be a long and difficult
process without a guaranteed outcome.
Thus, it isn’t realistic to assume PIP will cover all of your medical
bills. This is especially true in the current environment, where emergency
transport and an emergency room visit can use up the entire $10,000 benefit.
A seriously injured person will often have medical bills or lost wages
which are much greater. We often see clients with medical bills well into
the six figures.
Even more importantly, there are several kinds of losses one can suffer
in a car crash which PIP doesn’t cover at all. In Florida, victims
of negligent drivers are entitled by law to recover several categories
of damages caused by an accident, such as:
- Future medical bills.
- Future lost wages (known as loss of earning capacity).
- Damages for suffering, pain, loss of quality of life, loss of the ability
to enjoy ones life, disfigurement, disability, mental anguish, and the like.
Again, none of these three categories are covered by PIP or other mandatory
forms of Florida auto insurance. For that reason, there is no guarantee
that you could ever recover these items of damages from a financially
irresponsible driver who makes a mistake and injures you.
In an ideal world, all Florida drivers would carry insurance to cover these
damages when they negligently cause harm to others. We believe this coverage,
known as “bodily injury liability” coverage (BI), should be
mandatory. However, under current law it is not. As a result, many drivers
don’t want to pay for it and don’t have it. The uninsured
driver rate in our local area (Pinellas and Pasco County) is estimated
to be about 23-percent, or roughly one in four drivers.
Even among drivers who do carry BI coverage, the limits of that coverage
are often low. Auto insurance companies offer BI coverage with limits
as low as $10,000. That means the available limits may not begin to compensate
an injured person for all their damages.
Some people believe they can recover any additional damages from an at-fault
driver personally. That is just not realistic. Most Florida drivers do
not have enough available cash or assets to pay for a large damage award.
Also, Florida law protects certain property and assets from being taken
by creditors. That means there is little real hope of actually recovering
a large damage award from a deadbeat motorist.
Finally, many people have a false sense of security if they carry health
insurance. They believe health insurance will cover any damages which
PIP does not. Unfortunately, this is not the case. Health insurance does
not cover lost wages, future medical bills, or noneconomic damages at
all. And even the coverage it provides for medical bills is not complete.
Deductibles, co-pays, and coverage denials can still result in one being
stuck with large unpaid bills.
Fortunately, there is a solution. The answer lies in obtaining as much
uninsured motorist insurance as you can afford. We urge you to follow
this simple advice:
- Contact your car insurance company or agent to determine whether you have
- If you have BI insurance, make sure you did not reject UM insurance (you
automatically get UM if you obtain BI).
- Make sure your UM is “stacking”. Make sure you did not reject
stacked UM (stacking provides significant additional coverage in several
situations, even if you only have one car).
- Get several quotes on your insurance (the difference between companies
can be significant).
Sadly, we have seen firsthand how insurance agents or companies frequently
provide customers with poor explanations, and legally inaccurate explanations
of how the different coverages work. People regularly reject BI and UM
coverage and select “unstacked UM” based on bad advice. Don’t
be one of them. And don’t let anyone talk you out of it.
We realize that all insurance policies are expensive and increasingly so.
Still, the consequences of being uninsured or under-insured can be devastating.
Purchase the highest UM limits you can afford. Otherwise, great losses
can go completely uncompensated in the tragic event of a wrongful death
or catastrophic injury. It is difficult enough to collect what you deserve
from an insurance company after a collision. Having little or no coverage
can mean you don’t even get to try.
If you would like more information, or have any questions about uninsured
motorist insurance coverage, please feel free to
call our offices. We believe this problem would not exist as it does today if Florida drivers
were more informed when buying insurance.
We have no affiliation with any auto insurance company and do not make
money on the sale of UM insurance. We just think we owe it to our friends
and neighbors to let them know about this issue.