After a car accident, most people expect to file an insurance claim or lawsuit against the driver who caused it. In most states, this is exactly what could happen. In these states, vehicle owners buy liability insurance to protect other road users injured by a driver covered by the policy.
But insurers handle crashes differently in Florida. Under Florida law, vehicle owners must buy no-fault insurance, also called personal injury protection (PIP) coverage. This coverage is your only option for pursuing compensation after a minor accident. Depending on your injuries, it may also be your primary coverage for more severe accidents.
No-Fault Insurance Basics
No-fault insurance was introduced in the 1970s to address a specific problem: Courts were clogged with auto crash lawsuits, which cost liability insurers a fortune in legal fees. As a result, insurance premium rates skyrocketed.
No-fault insurance limits the right of accident victims to file lawsuits against at-fault drivers. Instead of filing a claim against the at-fault driver in all cases, victims could file a claim with their own insurer for minor claims. The insurer would pay medical expenses and income losses up to a pre-set policy limit. The victim cannot file lawsuits until they hit those limits.
These benefits are paid regardless of fault, hence the “no-fault” title. Thus, the driver who caused the crash is equally entitled to claim no-fault benefits. Injured passengers file their claims with the policy for the vehicle they were in. People injured in pedestrian accidents and bicycle accidents can file claims with the PIP coverage for the driver who hit them.
Limits of PIP
In Florida, PIP coverage comes with some important limitations. First, PIP coverage has $10,000 in policy limits by default. Thus, the insurer will only pay $10,000 in benefits after your crash unless you pay for additional coverage. If you have more than $10,000 in losses, you can file a liability claim against the at-fault driver’s insurance policy for any unreimbursed economic losses.
Second, PIP doesn’t cover all of your losses. Your insurer will only pay 80% of your medical expenses and medical-related out-of-pocket costs. It also pays just 60% of your income losses and replacement services expenses.
When PIP Coverage Does Not Apply
There are a few situations where PIP coverage does not apply. First, you do not need to start with PIP benefits after you suffer a significant, permanent injury. Instead, you can skip your PIP benefits and file a claim directly against the at-fault driver’s liability insurance. There are other exceptions to the no-fault system as well; check with an attorney to see if you are eligible to file a claim against the other driver.
A significant, permanent injury can take any of the following forms:
- Death
- Significant, permanent loss of bodily function
- Significant scarring and disfigurement
However, note that no-fault insurance is not required for motorcycle owners. If you get hit while riding your motorcycle, you can pursue a claim against the driver. After a motorcycle accident, you cannot file a PIP claim even if you want to file one because Florida motorcycle insurance policies do not include PIP coverage.
One of the important distinctions between PIP benefits and a liability claim is the compensation you can pursue. PIP claims can only seek compensation for economic losses like medical bills and lost income. Liability claims can seek compensation for full economic and non-economic losses.
Non-economic losses cover all the ways your injuries diminished your quality of life. Examples of these losses include pain, suffering, disability, and disfigurement. The compensation you can recover for these losses depends on the severity of your injuries. Significant, permanent injuries will often cause substantial non-economic losses.
Schedule a Free Consultation With an Orlando Car Accident Attorney
Very few car crash victims have experience dealing with insurance claims and lawsuits before their crash. Unfortunately, the insurance system can be unforgiving of mistakes, particularly if you miss deadlines to file under Florida’s statute of limitations.
After your crash, you should consider speaking to an experienced accident lawyer to learn your legal options under Florida’s no-fault insurance system. Contact Payer Law Personal Injury Lawyers at (407) 648-1510 for a free case review today.
