Florida Law Tackles Fraudulent Personal Injury Claims
Far too many Florida residents suffer serious injury and property damage in car accidents. But, believe it or not, a few bad apples actually make car accidents as a full-time job. This is done to file fraudulent personal injury claims to obtain money from their insurance carriers who believed they were paying for treatment relating to a real injury. Some argue that Florida’s cities, such as Fort Lauderdale, have a great deal of these fraudulent claims, which drives up the cost of the auto insurance policies that include Personal Injury Protection (PIP).
According to the Florida Office of Insurance Regulation the state experienced a “crisis” in personal injury protection claims in 2011. In that year alone, there was an estimated cost of $1 billion due to those fraudulent claims in Florida alone. Insurers were generally in the red as well. For every dollar brought in by the insurers in premiums, they paid out $1.40 meaning that the insurers lost considerably on PIP policies. This is particularly striking since insurers build in predictable accident and injury rates in order to make a profit. The fact that the insurers lost so heavily in the PIP category lends credence to the idea that unanticipated, and fraudulent, claims significantly impacted the market.
Staged car accidents have declined over the past year in Florida after the legislature passed new laws which reformed the state’s personal injury policy. Accidents involving personal injury protection throughout the state, including Fort Lauderdale, were cut in half from 2012 to 2013.
New Penalties Under the Law for Fraudulent Claims
Under the 2012 law, the state has imposed stricter requirements to make a personal injury claim as well as stronger penalties for fraudulent claims. The new law requires individuals involved in vehicle crashes to seek treatment within 14 days of the accident. The law also limits non-emergency medical claims to $2,500.
The law also established greater penalties for medical providers that help commit fraud. A doctor that is found to have committed personal injury fraud against an insurer may have his license suspended for five years and not receive PIP payments from insurers for ten years.
Benefit to Consumers?
The costs of claims, regardless of whether they are valid or fraudulent, will drive up the cost of premiums for all customers. From 2009 to 2012, many PIP premiums increased by over 35%. The major urban centers across the state, particularly Fort Lauderdale, Miami, and Tampa, experienced even greater premium increases.
The benefit to most consumers is that the premiums for personal injury protection insurance have dropped in tandem with the decline in false claims. Premiums for personal injury protection coverage was projected to decrease by about 13 percent in 2014.
Personal Injury Victims That Still Need Help
If you have questions about a personal injury claim that was caused by another person’s negligence, you should act quickly to protect your rights. You should also be careful to choose a knowledgeable and effective representative and counselor to help you in a very stressful time. Contact the attorneys at the Law Office of Cohn & Smith to guide you through a difficult time.