Your Florida Auto Insurance Questions Answered
As a Florida resident, you may have asked yourself the following questions:
1. What are the minimum requirements for auto insurance in Florida?
2. What auto insurance coverages should I have in Florida?
In the confusing world of insurance, we’re here to help. We’ll start with the first question – bear with us, there’s quite a bit to cover regarding these minimum requirements and it’s best if you’re knowledgeable of them.
1. Florida law’s minimum requirements for auto insurance include only two types of coverage.
(a) $10,000 Personal Injury Protection (PIP) coverage
PIP will provide immediate payment to your medical providers for costs, and payment directly to you for lost wages. PIP is a no-fault coverage which means PIP insurance is provided to the auto insurance policyholder and their family members, regardless of who was at-fault for the auto accident. But, PIP is a limited coverage because it will only pay for 80% of your medical costs related to the accident, and 60% of your lost wages up to $10,000.
(b) $10,000 Property Damage Liability (PDL) coverage
PDL covers you for financial liability that occurs when you are the at-fault driver in an accident and cause damage to someone else’s property. But, PDL will not cover you for damage to your own vehicle or property.
What does that $10,000 in front of each coverage mean exactly?
$10,000 is the minimum and maximum amount of PIP auto insurance coverage you can choose in Florida. But for PDL, $10,000 is only the minimum amount. You can select to protect yourself and your assets and choose a higher PDL limit.
The limit refers to the maximum amount your car insurance company will pay for damage to other people’s property resulting from an accident caused by your auto for which you are legally responsible. This amount also covers your legal defense if you are sued due to the accident you caused.
So, if you choose to only have the required minimum amount of PDL coverage on your auto insurance policy, your auto insurance company will only pay up to $10,000 for the other party’s vehicle damage and your defense. PDL helps protect your assets by paying for the damage to the other vehicle. You should ensure you purchase enough in PDL coverage to protect your assets. You will likely be responsible for paying any amounts above the liability limit.
Florida is one of the only two states in the country that does not require Bodily Injury Liability (BI) coverage.
While not required in Florida, BI coverage is absolutely necessary in the event that you cause a car accident in which another person is injured. This coverage will help pay for the other person’s medical expenses and lost income as a result of their injuries. In case you’re curious about the second state, auto insurance is optional in New Hampshire. The other 48 states require some form of Bodily Injury Liability coverage, in an amount of $10,000 or more.
It’s noteworthy that, in certain circumstances, Florida drivers may be required to obtain BI coverage in the form of an SR-22 or FR-44. These forms are attachments to your auto insurance policy, necessary if you have been determined a high-risk driver for one reason or another. An SR-22 may be required if you have too many points on your license or get in an auto accident without any insurance. The FR-44 may be required for a driver that has been found guilty of driving under the influence. The liability coverage limits are increased if these are required for your auto insurance policy.
Why Florida’s current minimum requirements leave huge gaps in coverage for a Florida driver.
First, because PIP and PDL are the only required coverages, many drivers in Florida will not elect to have BI coverage.
On one hand, if you injure someone in an accident caused by your own negligence and you don’t have BI coverage, you expose yourself and your personal assets. The injured person can sue you directly, and seek compensation through your available assets. On the other hand, if you are injured in an accident caused by another driver, who does not have BI coverage, your recourse against them is limited. A lawsuit against an uninsured driver will be costly to pursue, and may not result in much compensation, if any. Most people who actually have available assets to pursue will make the smart decision to protect those assets with BI coverage on their auto policy.
Second, many drivers in Florida will not have Uninsured/Underinsured Motorist (UM) Coverage.
This coverage can be added to your auto policy in various amounts, and will provide compensation to you for injury or death in the event the accident is caused by the negligence of a driver without BI coverage or with limited BI coverage. You cannot select uninsured/underinsured motorist coverage on your policy if you do not also choose to have BI coverage. You also cannot select uninsured/underinsured motorist coverage in an amount higher than your BI coverage. But, you can choose BI coverage in an amount higher than your uninsured/underinsured motorist coverage.
Third, many Florida drivers may not know that they should add Collision Coverage to their policy.
Because PDL will not cover you for damage to your own vehicle or property after an accident, every driver should add the optional collision coverage to their auto insurance policy. Collision coverage will limit your repair costs in the event of an accident causing vehicle damage and provides damage coverage even if you caused the accident.
2. What auto insurance coverages should I have in Florida?
Every Florida driver should at least add the minimum amount of bodily injury liability coverage, uninsured/underinsured motorist coverage, and collision coverage to their auto policy.
Will these added coverages increase your auto insurance premiums? Yes, they will (meaning you’ll owe more on your car insurance payment). Will you need to use them? Hopefully not. But, if you or your family is ever in an auto accident, big or small, you will be glad you made the decision to add these coverages to your policy.
Finally, make sure you stay informed.
During the 2018 Florida legislative session, a change to the auto insurance minimum requirements was proposed and nearly passed. The proposed change would have required drivers to maintain a minimum of $25,000 Bodily Injury Liability coverage. Changes to Florida’s Auto Insurance requirements are coming in the near future. Florida drivers should stay aware of the proposals and be prepared to make necessary changes to their auto insurance policies.
COHEN LAW GROUP
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