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PIP Deductibles and UM/UIM Rejection : Two Mistakes Florida Drivers Should Avoid

Posted by Robert E. Heyman | Jul 21, 2021 | 0 Comments

In May 2021, the Florida Legislature passed a bill which would have repealed the existing motor vehicle insurance law by eliminating Personal Injury Protection ("PIP") coverage and made Bodily Injury ("BI")  liability coverage mandatory. Under the new law, drivers would have been required to purchase a minimum of 25/50 liability coverage which would pay $25,000.00 per person and $50,000.00 per accident for injuries caused by the negligent driver.

At the eleventh hour, Governor DeSantis, stating that the measure would be too expensive for the average driver,  vetoed the bill to the dismay of both Plaintiff's attorneys and insurance companies. As a result, the PIP statute which was enacted in 1979 remains in effect. Because of that fact, Florida drivers need to be reminded that decisions they make when purchasing motor vehicle insurance can have serious consequences should they require medical treatment as a result of an accident.

Too often I have had to advise clients who thought they had "full coverage" that by either electing a PIP deductible or rejecting Uninsured/Underinsured ("UM/UIM") Motorist coverage, they are responsible for a portion of their own medical bills, and that when their PIP coverage is exhausted there is no other insurance coverage available to pay for their damages.

Why is electing a PIP deductible a bad idea?

PIP coverage is also referred to as "No-Fault" coverage, under which the owner of a vehicle, and under specific circumstances passengers and family members, are entitled to $10,000.00 in medical coverage regardless of whether they were at fault in the accident or not. The problem arises when an owner elects a deductible against their PIP coverage, in amounts ranging from $500.00 to $1,000.00. Deductibles are common in many types of  policies including, auto collision damage, health, homeowners and personal liability insurance. Those deductibles are advisable in those cases to keep the premium costs manageable. Not so much with PIP coverage.

In the typical PIP policy, a $500.00 deductible results in a premium savings of an average of $20.00, a $1,000.00 deductible brings a savings of approximately $80.00. The problem arises when a claim is made for PIP benefits, often times immediately following the accident, for ambulance, ER and diagnostic testing costs. My clients have discovered that they are responsible (basically self-insured) for the amount of the deductible before their PIP carrier will pay a dime. That $20.00 to $80.00 savings turns into no savings at all.

Why is rejecting Uninsured / Underinsured coverage a bad idea?

The second issue which I have unfortunately had to discuss with clients on too many occasions concerns the rejection of Uninsured / Underinsured Motorist coverage. Too many consumers have not been properly informed about just what this coverage provides. As a result of Gov. DeSantis' veto of mandatory bodily injury coverage, a significant percentage of Florida drivers will continue to drive without it. If a person is injured by one of them, the $10,000.00 in PIP benefits are all that is available in the absence of UM/UIM coverage. Health insurance (often with its own deductible) may help with medical bills, but there is nowhere else to look for compensation for past and future wage losses and damages for pain and suffering if the injuries are permanent.

I understand  that money does not grow on trees and I have no interest in filling the bloated coffers of insurance companies any further. However, as you can see, when purchasing auto insurance coverage, short-term savings can result in long term financial hardship. If you or a loved one is injured in a motor vehicle accident or you simply have questions concerning the various types of auto insurance, please do not hesitate to contact me at my offices in St. Petersburg at 727-822-3700.

About the Author

Robert E. Heyman

Bio Robert E. Heyman was born in Providence, RI, and grew up in Barrington, RI. He graduated from Barrington High School in 1974, and earned the rank of Eagle Scout. Following high school graduation, Mr. Heyman attended Northfield-Mt. Hermon Academy in Northfield, MA and thereafter attended co...


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