Florida No-Fault Auto Insurance Lapses

Florida has recently allowed its no-fault auto insurance law to lapse. The bill comes up for renewal in October, and various groups have been petitioning to either keep the auto insurance or lose it. State Farm has already come out and said that they would be dropping their car insurance rates an average of 16% if the law were to be eliminated.

The no-fault auto insurance law was intended to keep a close rein on auto insurance premiums, but all it did was increase the amount that the car insurance companies charged for the premiums. With the no-fault auto insurance law in effect, Floridians ended up paying the 6th highest car insurance rates in the country.

Many think that it is good that the no-fault auto insurance law has lapsed, and not just because of the rate issue. The plus of the system is that it eliminates need and incentive for lawyers to get involved in car insurance claims. No-fault provides compensation for all minor injuries obtained in a crash, and then lawyers would get involved in more major injuries only. It also allows consumers to get immediate payment from their car insurance company of their medical expenses.

However, the problem is that consumers cannot sue if they get denied by the car insurance company, unless they want to hire a lawyer on an hourly basis as there is no money in it for the lawyers other than that. The car insurance companies have power over the insureds so that what they say goes. Therefore, the auto insurance companies make big bucks off their insured, while consumers don’t get valid medical bills paid.
 

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