Auto insurance fraud bills approved in the senate despite criticisms


shutterstock_27888496Although the auto insurance fraud bills have been approved in the Senate there have been some critics who claim that this is a direct sellout to the auto insurance companies. The voting by the Banking and the Insurance Committee has been 7-4 and in favor of SB 1930. This bill was sponsored by Sen. Ellyn Bogdanoff, R- Fort Lauderdale and opposing it along with the Democrats was Sen. Mike Fasano, R- New Port Richey. As per the provisions of the bill, the insurers would get 90 days to look into the claims and ensure that they are legitimate before clearing the payments on the medical costs.

These provisions were considered to be ‘ridiculous’ by Sen. Joe Negron, R- Stuart and he wanted some changes in the bill if it had to win his support. He stated that fraud should not be used as a rationale for giving away all the parting gifts to the insurance companies by giving them 3 months’ time to pay the bill. Taking a moderate stand Negron stated that we should not look at every person who is involved in an accident as a potential crook as there are auto accidents happening all the time.

All motorists are required to carry PIP cover as per the state laws in Florida and this typically covers up to $10,000 worth of medical costs. The Chief Financial Officer Jeff Atwater as well as insurers claim that there are many staged accidents and unnecessary treatments as well as frivolous claims filed by fraudsters who hope to cash in on these policies. The people who are backing this PIP reform claim that fraud is pushing up costs for all policy holders by around $80 per year per vehicle.

The Insurance Regulation office at Florida released a report on Monday that showed the increase in PIP claims to about 28% since 2006 to 2010. There was also an increase in the number of PIP related lawsuits within the four-year period, where the insurer was the defendant as per the report.

Bogdanoff believes that there has been no sincere attempt made to fix the problem. She also went on to state that she would be more than willing to make adjustments in the bill to address these concerns. She also claims that this is a system that everyone seems to like and no one wants to turn it off. She has also insisted on panel members taking a stand on this issue.