Early in the 1970’s Florida’s automobile insurance industry started complaining that victims of automobile accidents could sue the tortfeasor or at-fault party for their injuries, pain an suffering with absolutely no threshold to recovery. They continued to complain that a relatively small car accident would gain some settlement value because the insurer would have to weigh the cost of defending the claim against the cost of “buying its peace”. Thus, even minor crashes would become large expenses and even bigger headaches for the insurers. In response, the legislature decided to adopt what is referred to now as the “FLORIDA MOTOR VEHICLE NO DASH FAULT LAW” to address this alleged problem. The constant complaints made by the insurance industry caused the legislature to put into place what is now a very confusing and difficult to navigate system based on automobile insurance.
The basic principle behind PIP insurance is that in exchange for accepting a threshold or limitation on the right to sue the at-fault party for pain and suffering, loss of enjoyment of life, the human damages in car accident, they will receive up to $10,000 of their medical bills paid whether they are at fault for the crash or not. This will insure that the injured person receives swift and virtually automatic payment of the medical bills and loss income from an insurer. The threshold requirement is that for the person to receive the pain and suffering portion of the damages is that the injured party would have to prove that there is a permanent injury with the losses exceeding the $10,000 PIP threshold. Additionally, the legislature enacted a $5,000 death benefit in cases where someone has available PIP coverage. And again, this is regardless of who is at fault. Thus, recovery under a negligent standard has been replaced with a legislatively mandated insurance contract, limited by the terms and conditions of the contract and the Statute.