The Property Casualty Insurers Association of America (PCI) commends the offices of the Insurance Consumer Advocate (ICA) and Chief Financial Officer on a new ICA report on no fault auto insurance fraud, and calls on the legislature to transform the state’s no fault system.
The report, dated Dec. 14th, notes that rampant fraud has created serious financial stress to auto insurance consumers and that changes are needed to stabilize the situation.
“We thank Chief Financial Officer Jeff Atwater and Insurance Consumer Advocate Robin Westcott for their continued diligent work on this key issue for Florida insurance consumers,” said Donovan Brown, PCI’s Florida counsel and regional manager. “The findings in this report are clear. We need to transform Florida’s Personal Injury Protection (PIP) system so that Florida drivers don’t continue to bear the burden of the rampant fraud that plagues our state.
”??Florida’s no-fault auto insurance system is rife with fraud, which has hit Florida consumers with higher auto insurance premiums. According to the National Association of Insurance Commissioners (NAIC), Florida insurance consumers pay 56 percent more than consumers in other states for automobile insurance premiums. Staged accidents, rampant litigation, and unscrupulous medical clinics that provide services to PIP claimants have led to skyrocketing costs for honest Florida insurance consumers.
According to the National Insurance Crime Bureau (NICB), Florida led the nation in staged automobile accidents and questionable insurance claims from 2007 to 2009. Four of the top 10 U.S. cities with the highest rate of questionable auto claims are in Florida: Tampa, Miami, Orlando and Hialeah. If the underlying problems with Florida’s no-fault law are not addressed in 2012, Florida will continue to lead the nation in fraudulent claims and higher costs for consumers.??PCI believes four key elements are needed to transform Florida’s broken PIP system:
· Allowing a reasonable amount of time for investigation of suspect claims.
· Placing reasonable limits on attorneys’ fees to reduce the incentive for unnecessary or prolonged litigation.
· Allowing for greater oversight of clinics that provide medical treatment to Personal Injury Protection claimants.
· Establishing reasonable treatment restrictions to prevent excessive and unnecessary medical treatment.
“These straightforward solutions are the essential fraud-fighting fixes that will help control cost drivers burdening the PIP system and will help stabilize costs to consumers that are currently spiraling out of control,” Brown said. “We urge Florida’s legislators to enact legislation this year that will help Floridians and put a stop to the criminals who are taking Floridians for a ride.”