FLOIR report shows PIP reform will benefit Florida drivers
The report from Pinnacle Actuarial Resources Inc. projects that the legislation, signed earlier this year by Gov. Rick Scott, should result in PIP claims falling by roughly 16 percent to 29 percent and a reduction in actuarially indicated PIP premiums of 14 percent to 25 percent.
In Florida, PIP premiums typically represent about 20 percent of the cost consumers pay for an auto insurance policy. Because many auto insurers in the state already file rates that are below the indicated rate, the FLOIR noted that the end result actually may be to mitigate against future premium increases.
“It is encouraging to see the actuaries determine that H.B. 119’s provisions cracking down on fraud and creating a more transparent process for PIP claims will benefit consumers,” said Christian Cámara, R Street’s Florida director. “Given that many of the changes aren’t yet implemented and that the law still may face legal challenges and efforts by some to ‘game’ the system, it’s still too early to have a full sense of all the benefits this legislation might provide.”
According to Pinnacle’s report, some of the largest savings introduced by the bill stem from its provisions proscribing coverage for massage therapists and acupuncturists, which is expected to save seven percent to 10 percent, and its limitations on non-emergency conditions, which should produce 10 percent to 15 percent savings.
R Street is a non-profit public policy research organization that supports free markets; limited, effective government; and responsible environmental stewardship. It has headquarters in Washington, D.C. and branch offices in Tallahassee, Fla.; Austin,Texas; and Columbus, Ohio. Its website is www.redesign.rstreet.org.