Most consumers have little or no idea what kind of auto insurance to buy so they simply ask for “full coverage” and hope to never find out what that actually means (or doesn’t cover). There’s just two little problems with that strategy - there’s no such thing as full coverage and if you live or travel in Florida you will get to know your insurance company very well! So, as part of my continuing effort to explain different legal topics we’ll go over what insurance is required in Florida and what options you have to supplement the basic requirements.
Let’s start with the mandatory requirements under Florida law and they are very easy to comply with and relatively cheap to purchase. If you own a vehicle in Florida you must have Personal Injury Protection (PIP) in the amount of $10,000.00 (although your deductible can vary) and Property Damage Coverage (PD) of at least $10,000.00. That’s it, we’re done here what a great state! Or not, because the minimal amount required under Florida law won’t be enough to cover you if you have an accident so you’ll need more of everything for protection in this crazy state.
DIFFERENT TYPES OF INSURANCE COVERAGE
Personal Injury Protection (PIP) Insurance (Mandatory)
Also called Florida No-Fault Insurance, Personal Injury Protection (PIP) Insurance covers you for medical bills and lost wages regardless of who causes the accident. It will also cover your kids, members of your household and passengers who don’t have their own PIP Insurance because they don’t own a vehicle. People riding in your vehicle who have PIP will be covered under their own policy for any injuries. PIP also covers your child if he or she suffers an injury while riding on a school bus and similarly protects you when you’re in someone else's car and as a pedestrian or bicyclist if you’re injured in a crash involving a motor vehicle.
Property Damage Coverage (Mandatory)
This coverage kicks in when you smack something you shouldn’t have smacked. It pays for physical damage and destruction of someone else’s property resulting from a vehicle accident and your insurer will defend you in a lawsuit up to the amount of your PD coverage.
Bodily Injury Liability (BI) Coverage (Optional)
Bodily Injury Liability coverage pays for serious and permanent injuries or death to others when you’re at fault in a car crash. BI will pay for injuries up to the limits of your policy and provide legal representation if you get sued. It also provides coverage for injuries caused by you or members of your family who live with you even if they were driving someone else's vehicle and may also cover others who drive your automobile with your permission.
Uninsured/Underinsured (UM) Coverage (Optional)
While Florida law mandates that all drivers must be insured – hello and welcome to reality – many Florida drivers have little or no coverage and you’re screwed if you’re in an accident with one of them. UM coverage is designed for protection when the miscreant who just hit you has no insurance and is one of the most important options to consider adding to your policy. This coverage extends to bodily injury, sickness, disease and even death if caused by an auto accident and the at-fault driver has no BI coverage or insufficient coverage for the severity of your injuries.
Collision Coverage (Optional)
Collision coverage pays for repairs or the actual cash value of your automobile if it collides with another car, flips over or crashes into an object regardless of who causes the accident. If your car is totaled where the cost to repair it exceeds the value, collision coverage will pay the value of your car.
If your car is older, it may not be worth carrying collision coverage depending on the value. On the other hand, if you have a more expensive car or one that is relatively new collision insurance can help get you back to where you were before any damage to your car. Note: If you have a lienholder (financing) this coverage is required.
Comprehensive Coverage (Optional)
What if something happens to your car that is unrelated to a covered accident - weather damage, you hit a deer, your car is stolen, fire, vandalism or flood - will your insurance company cover the loss? Liability and collision insurance cover accidents but not these examples which are covered by the Comprehensive portion of your policy.
Comprehensive is great to have if you can afford it. Anti-theft and tracking devices on cars can make this coverage slightly more affordable but it’s generally expensive and may not be necessary if your car is easily replaceable. Note: If you have a lienholder, this coverage is required.
Medical Payments (Med Pay) Coverage (Optional)
This coverage is basically an extension of your PIP coverage and pays expenses for necessary medical and funeral services resulting from bodily injury or death from an automobile accident regardless of fault. It kicks in once your $10,000.00 PIP coverage is exhausted.
Stacked UM Coverage (Optional)
One of the most confusing insurance concepts is called “stacked” UM coverage which combines the UM coverage on each one of your individual vehicles for a higher combined total coverage. What this means is that Florida law requires insurance companies to add together, or "stack" uninsured/ underinsured (UM) coverage for multiple vehicles unless otherwise rejected in writing. For example, an insured has three vehicles and each has a UM limit of 50/100 ($50,000 per person/$100,000 per accident). This means they have up to $150,000 per person/$300,000 per accident available for a claim.
Non-Stacked UM Coverage (Optional)
An insured can elect not to have their Uninsured/Underinsured (UM) Coverage added together (non-stacked) by signing a non-stacked Uninsured/Underinsured Motorist form which is much cheaper but won’t help much if you have a serious accident.
For more information on what insurance coverage makes sense for you and what is covered if you have an accident contact Gregg Paley, Esq. at Colson & Paley, LLC