Automobile Insurance In Florida,

 

 

 

 

Automobile Insurance Toolkit Table of Contents

In Florida, vehicle owners may be required to

purchase two types of auto insurance.

The first type of auto insurance is outlined in the

Florida Motor Vehicle No-Fault Law (s. 627.736, Florida

Statutes). It requires every person who registers a

vehicle in Florida to provide proof they have personal

injury protection (PIP) and property damage liability

(PD), with minimum limits of $10,000 each. PIP covers

injuries you and certain others may incur in an auto

accident, regardless of fault. PD covers your liability

if you damage property belonging to someone else

in an auto accident. Examples might include another

person’s vehicle, a telephone pole or a building.

Individuals who are in the State of Florida with their

vehicle for more than 90 days in the last 365 days

must carry these minimum limits of coverage. It is

important to note that the 90 days do not need to be

consecutive in order for the law to apply. Questions

about titling or registering your vehicle or further

clarification on how Florida’s auto insurance laws apply

to you should be directed to the Florida Department

of Highway Safety and Motor Vehicles. You may visit

them online at www.flhsmv.gov or call (850) 617-2000.

The second type of auto insurance is outlined in the

Florida Financial Responsibility Law. It requires drivers

who have caused accidents involving bodily injury/death

or received certain citations, to purchase bodily injury

liability (BI) coverage with minimum limits of $10,000

per person and $20,000 per accident, referred to as

split limits. You may purchase a policy that covers both

types of insurance required with a single limit of at

least $30,000. Drivers convicted of driving under the

influence must purchase BI coverage in the amount of

$100,000/$300,000 and $50,000 in PD liability.

The reason for the Florida Financial Responsibility

Law is to require owners or operators of motor

vehicles to be financially responsible for damages

and/or injuries they may cause to others in an auto

accident. The failure to be financially responsible

may result in the loss of driving privileges in Florida.

Although there are other ways to prove financial

responsibility that are acceptable to the Florida

Department of Highway Safety and Motor Vehicles,

our publication deals strictly with insurance.

01

Coverages & Minimum

Requirements

Table of Contents Automobile Insurance Toolkit | 5

Coverage Descriptions

Bodily Injury Liability (BI)

This coverage protects you for injuries or death to

someone else that you are legally liable for resulting

from a motor vehicle accident. As the owner of a

vehicle, anytime an accident occurs involving your

insured vehicle (whether or not you are driving), the

possibility exists that you may be held financially

responsible for any damages. This coverage not

only covers the actual loss incurred, it can also

provide coverage for your defense if you are sued.

When referring to BI limits of liability, the first number

represents the maximum amount of coverage you have

for each individual injured in a given accident and the

second number is the maximum amount of coverage

available to all injured persons in that accident.

Let’s look at an example.

You cause an accident and there are two people

in the other vehicle. You chose to carry BI

limits of $10,000 per person and $20,000 per

occurrence. Person “A” sustained $25,000 dollars

in injuries and Person “B” sustained $15,000

in injuries. How will your policy respond?

EXAMPLE Person “A” Person “B”

Total Injuries: $25,000 $15,000

Their PIP Coverage: $10,000 $10,000

Your Responsibility: $15,000 $5,000

Payment from Insurer: $10,000 $5,000

Making a decision about the amount of coverage you should carry is a personal decision based on many factors.

Discussing your coverage needs with a qualified insurance agent can help you better understand your options. It is

important to remember that if an accident occurs, and the injuries sustained by another party are beyond the limits

of your insurance policy and the injured party has a permanent injury, scarring, disfigurement or is killed, they or

their beneficiary may pursue recovery from you through the court system.

Property Damage Liability (PD)

PD liability pays for damage to another person’s

property caused by you or someone else operating

your insured vehicle. Most often this coverage will

be used to repair the other automobile(s) involved in

an accident with your insured vehicle. It can also be

used to pay for damage to street signs, mailboxes,

buildings or other property owned by another party.

Uninsured/Underinsured Motorist (UM)

This coverage is optional but provides very important

benefits to you and certain others who sustain injuries

from an auto accident caused by an uninsured or

underinsured motorist. The coverage allows you to

collect amounts from your own insurance carrier that

you would have been able to collect from the at-fault

party if they had insurance or sufficient insurance

limits. It can provide additional medical expenses, lost

wages, pain and suffering and other expenses that

might arise when an injury occurs. Once coverage

has been triggered, benefits will be paid directly

to the injured person, normally in a lump sum.

You may wonder why you need to purchase UM

coverage if you have PIP and health insurance since in

most cases, after your PIP coverage is exhausted, your

health insurance may pay some of your medical bills.

Most health insurance policies include deductibles and

copayments which are out of pocket expenses for you.

Health insurance normally does not provide coverage

for expenses you may incur if you or a covered family

member must stay in a convalescent center. In some

cases when an injury is severe, permanent, or requires

a longer recovery time, it can be important for your

quality of life and financial health to have coverage

that will continue to pay for lost wages. Replacement

services may be required like lawn maintenance

or housekeeping. Due to your injuries, your home

may require modifications like a wheelchair ramp

or your vehicle may require special equipment.

When purchasing UM, you must make two decisions.

You must decide the limits you need and whether

or not you want stacked or non-stacked coverage.

All insurance companies are required to provide

stacked UM with the same limits as your Bodily

Injury coverage. Some insurance companies offer the

option to purchase lower limits and/or non-stacked

6 | Automobile Insurance Toolkit Table of Contents

coverage. Stacked UM coverage means that the limit

will increase by the number of vehicles you own,

regardless of whether or not the vehicles are insured

on the same policy. In other words, if you have stacked

UM limits of 50/100 and own three vehicles, your

actual coverage is multiplied times three or 150/300.

If you elect non-stacked UM at 50/100, that is the

maximum coverage available in an accident regardless

of how many vehicles you own. Another important

coverage difference between the stacked and nonstacked

form is how the policy will respond if you

are injured by an uninsured/underinsured motorist

in a vehicle you own, but do not have insured. In

that case, only the stacked form would respond.

Personal Injury Protection (PIP)

You will often hear Florida referred to as a “No-Fault

State.” This means that any time you are injured in

an auto accident you will file your injury claim with

your own insurance company, regardless of who is

at-fault. However, once an injured person pierces

the tort threshold, they may seek recovery for costs

not duplicated by PIP from the at-fault party.

Section 627.737, Florida Statutes, states the threshold

has been pierced when an injury from a car accident

results in significant and permanent loss of important

bodily function, permanent injury, significant or

permanent scarring, disfigurement or death. Section

626.9541, Florida Statutes, protects consumers from

an increase in their premium for filing a PIP claim

in a not-at-fault accident. Section 627.736, Florida

Statutes, details who is covered under your PIP but

there are many variables which ultimately determine

how your policy will respond in a claim situation.

The following describes situations

when coverage applies:

1. Injuries to named insured:

a. If the accident occurs in Florida, while

occupying any defined motor vehicle or if

struck by a defined motor vehicle while not

occupying any self-propelled vehicle.

b. If the accident occurs outside of Florida,

while occupying the insured motor

vehicle or a vehicle owned by a resident

relative, if it is insured for PIP.

2. Injuries to resident relatives of named insured:

a. Covered the same as the named insured.

For accidents outside of Florida, the

named insured’s benefits apply to the

relative only when the relative is occupying

the named insured’s motor vehicle.

3. Persons other than named insured and relatives:

a. If the person is not an owner of a motor

vehicle or entitled to benefits from another

owner’s insurance company and if the accident

occurs in Florida, the owner’s benefits are

payable to such persons (1) while occupying

the named insured’s motor vehicle or (2) if the

person is a Florida resident, if struck by the

insured’s motor vehicle while a pedestrian.

 

 

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