As auto insurance fraud is thrusted into the limelight by the actions of federal and state regulators this week in New York, the eleven other states that host no-fault insurance laws are taking a hard look at what can be done to make fraud a less serious issue. Florida is currently the leader in terms of auto insurance fraud, much of which is spurred by the state’s no-fault laws. These laws require insurers to pay benefits to victims of car accidents no matter who may be at fault. Like in New York, Florida legislators have constantly been battling the rash of crime that the law has created.
As fraud becomes worse, Florida lawmakers are now making an attempt to reform the no-fault program. As such, the Senate Budget Committee has thrown its support behind Senate Bill 1860, a legislation that would reform the state’s insurance regulations. Senator Joe Negron, R-Stuart, the bill’s primary sponsor, believes that reform is the last chance the state’s system has to survive fraud. The bill has also received support from Governor Rick Scott, who has been a proponent for reform for some time now.
According to state and insurance officials, the no-fault insurance program has seen premiums grow by more than $1 billion over the past several years. Much of this growth is being attributed to fraud. Insurers have had to raise premiums constantly to keep up with the rampant pace of claims coming from staged accidents.
Currently, SB 1860 is not scheduled for a hearing from the full House, which means that reform will have to be a subject for another time, perhaps months into the future.
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