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What to Expect After No-Fault Expires

Sep 10, 2007

By Beatrice E. Garcia, The Miami Herald

Sep. 11--Here are questions and answers on figuring out what auto insurance you might need after the no-fault law expires as expected on Oct. 1.:

Q. What kind of auto-insurance coverage will be mandatory?

A. After the no-fault law expires, drivers will no longer be required to buy $10,000 in personal injury protection, or PIP, that covers medical expenses and lost wages in an accident, regardless of who is at fault.

Only property damage liability will be required for drivers to register a car in Florida. The minimum required is $10,000.

Property damage liability covers damage to another person's property, including buildings and fencing.

Q. Will new policies be issued to all insured drivers after Oct. 1?

A. No. Most insurance companies will make the change as policies come up for renewal. On policies renewed before Oct. 1, the personal injury protection will remain in place until the policy expires.

However, some insurers, such as State Farm and Allstate, will allow policyholders to eliminate the PIP coverage from policies after Oct. 1. If they have paid for their policies in full at renewal, they will be issued a refund. If they're paying premiums monthly, the unused portion of the PIP premium will be credited to their remaining payments.

But any accidents that happen after Oct. 1 are no longer under the no-fault system. Fault will have to be determined by police on the scene or in court before further benefits are paid.

Q. Will auto-insurance rates go down because of the change?

A. Overall, premiums could drop because drivers won't be required to buy personal injury protection. This would be true for drivers who have healthcare insurance through an employer or already pay for it individually.

Eliminating PIP could save drivers with health insurance $100 to $200 a year -- and possibly more in South Florida, where coverage is expensive.

But insurers have increased rates on such optional coverages as bodily injury liability and uninsured motorists coverage, because they anticipate more claims under these coverages. The increases will offset some savings realized by eliminating PIP.

Q. If a driver has no form of healthcare insurance, do auto insurers offer any coverage that would pay medical bills?

A. For drivers with no other form of health insurance, they may need to buy medical payments coverage to cover their medical bills. Depending on the insurer, medical payments coverage could cost the same or more than PIP coverage so there could be little or no savings for such drivers.

Q. If a driver is involved in an accident with an uninsured driver, how is damage to your car or medical bills paid?

A. Whether the other driver is at fault, you would need to carry uninsured motorist coverage to have your medical bills paid.

A driver could also rely on his own healthcare insurance to cover doctor and hospital bills.

A driver's own collision coverage would take of the auto-repair bills.

Q. What is the state's financial responsibility law and does it make liability coverage mandatory?

A. The financial responsibility law requires that drivers have proof they can meet the liability from an accident if they are at fault. Proof can be insurance, such as bodily injury liability coverage, a $30,000 surety bond of, or proof of personal wealth.

Proof is demanded when an accident occurs. If a driver doesn't have property damage liability insurance, his license could be suspended under this law.

Q. In evaluating their coverage, what questions should customers ask their insurance agents?

Drivers should consider whether they have assets to protect and whether they need to increase the optional coverages they already have.

All insurers are encouraging policyholders to review their auto-insurance coverages with their agents.

Q. Where can drivers get more information?

A. Florida's chief financial officer, Alex Sink, has prepared a website that provides answers for consumers:, click on the "Life Without No-Fault" box at the top right side of the page.

AAA Auto Club South is holding two seminars later this month to help consumers figure out the coming changes in auto insurance. These seminars are open to all AAA members:

--Wednesday, Sept. 26; AAA Auto Club South Miami office, 6643 South Dixie Hwy., South Miami; 5:30-7:30 p.m.

--Thursday, Sept. 27; AAA Auto Club South office, 7074 SW 117th Ave., Kendall; 5:30-7:30 p.m.


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