New insurance consumer advocate getting into battle over no-fault auto insurance

The following article was published in The Florida Current on August 11, 2011:

New insurance consumer advocate getting into battle over no-fault auto insurance

By Christine Jordan Sexton

There are growing sings that the big insurance battle for the 2012 session may not be property insurance but the state’s no-fault automobile insurance.

Florida’s new insurance consumer advocate Robin Westcott is now jumping into the fray. Westcott on Thursday said she’s creating a “working group” on personal injury protection (PIP) insurance.

Westcott said she wants to keep a new working group on personal injury protection relatively small and that it will include lawmakers, consumers and insurers and representatives from the medical industry, perhaps people who testified before the Legislature last year on the issue.

She said she hopes to have committee members announced “in the next week” and that the group would work through November to submit its recommendations to the Legislature, which meets in January.

While she acknowledged that it is a “pressing time frame” to finalize its recommendations by November, Westcott said, “many of the issues are framed for us.”

PIP is a no fault insurance system that provides $10,000 worth of medical coverage for automobile related injuries, regardless of who is at fault.There are growing concerns about fraud in the system, though.The Office of Insurance Regulation released the Report on Review of the 2011 Personal Injury Protection Data Call,  which showed that costs in the PIP system are increasing and that PIP payouts have gone from about $1.5 billion in 2008 to approximately $2.5 billion in 2010. The OIR report also showed that Florida PIP claims involve approximately 100 medical treatments at an average total cost of $12,000 compared to the national average of about 50 treatments at an average total cost of $8,000.

The insurance industry-supported group the National Insurance Crime Bureau released a report earlier this year revealing the percentage of questionable PIP claims in Florida rose 34 percent from 2008 to 2010. The group also rated Miami,Tampa and Orlando among the top five cities in the nation for questionable claims.

The Legislature in 2011 considered changes to the PIP program but ultimately did not pass anything substantial. Sen. J.D. Alexander included in a budget conforming bill provisions that would have capped attorneys fees but was forced to remove it after criticism that the issue wasn’t vetted. Ultimately nothing passed.

But all signs are the issue will be revisited. Gov. Rick Scott has said that he is likely to come out with his own ideas about PIP and the Senate Banking and Insurance Committee is reviewing the PIP system in the interim between the 2011 and 2012 session.

Westcott said the time frame is ambitious but manageable. “There was so much debate (during the 2011 session) and so much said. We’re going to see where we are and see where we can go.”

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