A judge in Tallahassee recently blocked Florida’s new no fault insurance
law. The judge issued a written decision finding that the new law violates
the constitutional right of access to courts. While the judge’s
decision is likely to bring howls from the insurance industry about “judicial
activism,” it makes sense when one considers our constitution and
To understand the decision, however, one must put it in context with the
no fault law’s history. So at the risk of oversimplifying a few
things, here is a brief review:
Florida has had a no fault auto insurance law for decades. Generally, that
law requires a person injured in a car accident to use their own insurance
coverage for certain expenses. An injured person is required to first
seek benefits under their own coverage, or the coverage on the vehicle
they were occupying, before making a claim against others. This is true
even if another person caused the accident. Because this coverage is not
tied to legal fault, it is often referred to as “no fault.”
While the no fault moniker is common, this coverage is actually called
personal injury protection, or PIP. Drivers in Florida are currently required
to have $10,000 of this coverage.
The upside of PIP is that is was designed to be available quickly and easily,
and without the need for fights about liability. The downside is that
PIP also restricts people’s right to make claims and seek damages
in a personal injury or death lawsuit arising from a car accident.
Even though PIP’s restrictions took away some of the damages historically
available to people injured in
car accidents, Florida courts permitted those restrictions. They found the no fault
system provided benefits which largely replaced traditional courthouse
damages. While the compensation schemes were not identical, the courts
considered no fault to be at least roughly as good as the old damages system.
Until 2013, a full $10,000 would be available to pay accident-related expenses
such as medical bills and lost wages to an injured person. However, the
Florida legislature restricted PIP coverage last year. Under the new law
which became effective a few months ago, the full $10,000 is only available
to someone who has an emergency medical condition. For those with lesser
medical problems, only $2,500 is available. The legislature also put other
restrictions on coverage, such as barring coverage for those who don’t
receive medical care for 14 days after an accident.
However, these new restrictions create a problem. The new system is so
much more stingy that it no longer looks like a decent tradeoff for the
old-time damage remedies people lost. While the legislature took certain
no fault benefits away, it provides no new benefits or upsides. There’s
a serious question about whether it is still a reasonable alternative
to the old courthouse damages system.
This brings us back to the court’s decision from Tallahassee. The
judge there handed the insurance industry a defeat on constitutional grounds
this week. The court found PIP’s new restrictions were too severe.
According to the judge, they turned PIP into a constitutionally inadequate
substitute for the old damages law.
The court’s order blocked the new PIP law. In legal terms, he entered
a temporary injunction, which at least temporarily prevents some of the
restrictions in the new law from being effective.
There will no doubt be an appeal and plenty of hand-wringing by the new
PIP law’s proponents. However, the decision rests on a very basic
constitutional principle: you can’t simply take legal rights away
unless you replace them with something which provides comparable benefits.
The new PIP law flunked that test.
The judge who decided the case followed the law as he reasonably understood
it. That is what judges are supposed to do. While one may disagree with
his ultimate conclusion, his decision was not activist, result-oriented,
or the result of some left-wing agenda. If you hear otherwise from the
insurance lobby, consider the source.