Consumers in Florida will soon see significant cost savings and a more consumer-friendly automobile insurance system when the state’s fraud ridden no-fault personal injury protection (PIP) law sunsets October 1, 2007, according to insurer members of the Property Casualty Insurers Association of America.
“In October, auto insurance policyholders will be the big winners as they see rates reduced and have the right to choose the policies that best address their circumstances,” said William Stander, assistant vice president and regional manager for PCI. “As families face uncertain times due to soaring property taxes, the end of PIP will result in immediate and definite cash savings.”
Due to the costs involved in the no-fault system, Florida drivers currently pay among the highest insurance premiums in the country, accordng to insurers. Stander said the sunset of the law will return the state to a tort-based automobile insurance system “that more fairly places the cost burden on the person at fault in an accident, promoting alternate dispute resolutions.”
“The current system encourages fraud and costly litigation,” said Stander. “It discourages reasonable cost-containment resolutions resulting in increased auto insurance premiums for individuals. Florida policyholders have been paying for unnecessary costs due to the no-fault law for too long. The sunset of PIP will be a victory for the people of Florida.”
The no-fault system was supposed to provide quick and fair compensation following an accident. For decades, drivers were required to carry the $10,000 policy to pay for the cost of their own injuries in an accident, regardless of who was at fault.
Source: Property Casualty Insurers Association of America
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