Florida lawmakers have pondered repealing the state’s 1970 no-fault insurance law for more than a decade, coming close to doing so in three straight sessions before approving a hotly-debated, but ultimately overwhelmingly supported, revamp this year.
The debate, however, didn’t end when Senate Bill 54 was adopted on April 30, the last day of the legislative session.
In fact, it intensified as insurers and state officials lobbied Gov. Ron DeSantis to veto SB 54, which would have required Florida’s 16.5 million do away with personal injury protection (PIP) and secure mandatory bodily injury (MBI) coverage by Jan. 1.
Although SB 54 passed the Senate 37-3 and House 100-6, the convincing tallies belied ambivalence underscored by concerns expressed by state officials.
In February, Florida Chief Financial Officer Jimmy Patronis said repeal would increase uninsured driving and in March, state Insurance Commissioner David Altmaier said more study was needed to determine if repeal would benefit Florida drivers, who pay the nation’s highest auto insurance premiums.
SB 54 took nearly two months to move from the Legislature to DeSantis’ desk, arriving there on Monday.
In the interim, the governor received more than 37,000 comments from Floridians, mostly against repeal, and the adamantly opposed Personal Insurance Federation of Florida, Florida Insurance Council, American Property Casualty Insurance Association, Florida Chiropractic Physician Association and Florida Emergency Physicians Association were among opponents that stepped up efforts to convince him to veto SB 54.
The bill’s death knell may have come, however, when the Florida Office of Insurance Regulation (OIR) published a study earlier this month that forecast SB 54 would raise insurance rates.
The 185-page analysis projected no-fault repeal could boost premiums for millions of drivers by nearly 50%, significantly increase uninsured driving and generate $13 million annually in uncompensated medical care.
“We estimate an overall increase in premiums of 13.3% for all coverages combined, or $202 per car annually for the average vehicle,” it determined.
That study confirmed a bevy of similar forecasts. A 2018 Milliman report projected repeal would raise rates 5.3%, or $67 a year. An APCIA analysis forecast 3-6% rate hikes. Another maintains for about 40% of Florida drivers – 7 million – replacing no-fault PIP with MBI could mean annual rate increases of $600 to $1,000.
So it came as little surprise when the Governor’s Office announced Tuesday night that SB 54 was among four bills DeSantis had vetoed.
“While the PIP system has flaws and Florida law regarding bad faith is deficient, SB 54 does not adequately address the current issues facing Florida drivers and may have unintended consequences that would negatively impact both the market and consumers,” DeSantis wrote in his three-paragraph veto letter.
With the demise of SB 54, Florida remains one of just two states that don’t require MBI coverage. Under state law still in effect, Florida drivers must maintain personal injury protection (PIP) coverage of $10,000 in medical, disability and funeral expenses, without regard to fault, and subject to a $2,500 limit for non-emergency medical care. In exchange for PIP, vehicle owners were immune from tort claims.
SB 54, carried by Sen. Danny Burgess, R-Zephyrhills, exchanged PIUP for MBI coverage that would have paid out $25,000 for each injured person or $50,000 per event and $10,000 for property damage.
APCIA President of State Government Relations Logan McFaddin on Wednesday praised DeSantis “for protecting Florida drivers from the substantial auto insurance cost increases that would have likely occurred if he had not vetoed Senate Bill 54.”
When Florida lawmakers go back to the no-fault repeal drawing board in 2022, McFaddin said APCIA stands ready to “be resource for Florida legislators on this issue should they revisit it in the upcoming legislative session.”
Original Location: DeSantis vetoes repeal of no-fault insurance law