YouTube Tuesday: Personal Injury Protection Insurance

While today’s offering from YouTube and a Florida insurance firm is geared toward insurance requirements in Florida, Personal Injury Insurance, or PIP, is something everyone should consider. What is PIP? Watch and learn!

Alert: Warranty Company Banned in Florida

Motorists in Florida be aware: Kevin McCarty, Florida Insurance Commissioner, announced on Friday that the Office of Insurance Regulation has issued a Cease and Desist order to Auto Repair Warranty, Inc. (ARW), Auto Repair Group LLC (ARG), and Michael R. Petruziello, requiring that they stop selling unauthorized motor vehicle service agreements in the sunshine state.

Investigators from the Office of Insurance Regulation (Office) concluded that the companies mentioned above have been selling unauthorized and unlicensed vehicle repair service agreements through their website, autorepairwarranty.com, and through agreements sold by ARW. In addition, investigators determined that the companies, both of which are based in Ohio, engaged in unfair or deceptive acts, and unfair methods of competition, as well as never having authorization to sell warranty products in the state of Florida in the first place.

In a statement to the press, Commissioner McCarty said, “Companies selling insurance products of any kind must adhere to Florida’s stringent licensing process. Floridians should always verify the products they purchase are being offered by companies licensed in our state.”

Maine Couple Not Getting Money from Mitsubishi for Death of Son, Florida Appeals Court Says

The Insurance Journal is reporting today that Florida’s Fourth District Court of Appeals has ruled against a couple from Maine who were seeking an $11 million settlement from Mitsubishi Motors after the 2004 death of their son.

The appeals court, in a 2-1 ruling, overturned the original 2008 jury verdict explaining that Palm Beach County Circuit Judge Elizabeth Maass was in error when she refused to allow the automaker to show to jurors the charts, photos and videos of the results of tests it conducted which disputed the claim that a faulty seat belt caused the death of 25-year-old Scott Laliberte.

While experts appearing on behalf of Mitsubishi were allowed to tell the jury that the seat belt was not a factor i the rollover accident on I-95 in Brevard County, without visual aids, the appeals judges said, the testimony was “barren and unsubstantiated.”

Appeals Court Judge Cory Ciklin disagreed with his colleagues, Judges Dorian Damoorgian and Melanie May, saying that circuit judges are routinely forced to make such decisions, and that second-guessing them is wrong.

He wrote, “The trial court sensitively balanced the relevance of Mitsubishi’s demonstrative aids against the danger of unfair prejudice and confusion and made the right calls — or at least made the calls that were best performed by the person wearing the boots on the ground.”

Julie Littky-Rubin, the West Palm Beach attorney who represented Laliberte’s parents, Donna and Peter, said she will ask all twelve of the appeals judges to re-consider the case. Based on Ciklin’s dissenting opinion, she believes she has a good chance of convincing the full court to overturn the new decision.

Wendy Lumish, who represented Mitsubishi, said she was pleased by the court ruling.

Go-Cart Waivers Now Legal in Florida

You might not think there’s a connection between car insurance and theme parks, but in Florida there is – sort of. It seems that such parks, as well as go-cart tracks – anything deemed to offer “potentially dangerous fun” must have insurance to protect against injuries patrons. Earlier this week, those parks regained the liability protection for injuries to children they’d lost during a court ruling years ago.

Two years ago, a system of waivers was put into place, which parents could sign in order to allow children to participate in rides with perceived risk, such as go-carts and jet-skis. Unfortunately, the Florida Supreme Court invalidated the waivers because there was no law on the books allowing waivers to be used.

On Thursday, however, Governor Charlie Crist signed Senate Bill 24404 into law, making it legal for the waivers to be used. The law went into effect immediately upon being signed.

The bill was a compromise between business interests and trial lawyers who represent accident victims.

Operation Crash for Cash: Successful and Still Needed

In cooperation with the Hillsborough (Florida) County Sheriff’s office, which is spearheading the program with assistance from the Florida Department of Insurance Fraud and the National Insurance Crime Bureau (NCIB), Direct General Insurance, among other auto insurers, have partnered to enforce “Operation Crash for Cash,” a joint probe into accident fraud that has resulted in more than fifty arrests so far.

In the eight months of the program’s operation there have also been investigations of four medical clinics, and the charges filed by authorities have included racketeering, the staging of car accidents, and insurance fraud.

According to Direct General’s representatives, this operation serves to underscore the insurers “zero tolerance” policy toward fraud, as well as its efforts in partnering with law enforcement agencies.
Direct General’s Chief Claims Officer, Jim Sclafani, told the press, “Particularly in Central Florida, where the number of staged auto accidents is soaring, Direct General will continue to invest in corporate resources and explore new ways to collaborate with law enforcement agencies to help combat auto insurance fraud. Reducing fraudulent claims is a key aspect in keeping auto insurance rates down for honest drivers.”

Auto insurance companies in Florida say that it is escalating losses from fraud that has forced them to charge higher premiums and institute stricter underwriting guidelines, which, in turn, has impacted both the availability and affordability of car insurance coverage for drivers in the “Sunshine State.”

Sclafani said that as the fraudsters have moved north from South to Central Florida, his company has increased its fraud detection training for claims personnel and adjusters, and boosted resources in its Special Investigations Unit.

Currently, Florida is America’s center for organized insurance fraud, who purposely crash vehicles and falsely report injuries from car accidents. As well “injured” drivers and passengers seek treatment from shady medical facilities which file false insurance claims in order to max out the mandatory $10,000 Personal Injury Protection (PIP) coverage that all Florida drivers must carry. The members of such crash rings typically benefit by sharing the insurance money they’ve fraudulently obtained.

While no legitimate injuries were caused by fraudsters who were identified in Operation Crash for Cash, authorities have estimated that insurance companies would have been billed about $18 million due to fake injuries and claims. More than 27% of all staged accidents nationwide, in the first half of 2009, happened in Florida.

Florida’s drivers already pay among the highest auto insurance premiums in the U.S. Without programs like Operation Crash for Cash, this will only continue.

GEICO, Students Get Artistic in Seatbelt Campaign

It’s no secret that seatbelts save lives, but most people would never consider them to be objects of art. Of course, most people aren’t among the thousands of Florida students who entered GEICO’s annual Safety Belt Poster and Video Contest.

Michael Franck, of Miami-Dade County is one of the participating students, and ended up winning a cash award as a national prize winner in the computer-generated art category. Franck used his skill with graphic design to create a poster showing a seat belt in the form of an angel with outstretched wings, and was judged, within his category, have the clearest, most focused safety message.

GEICO’s regional vice president,George Rogers, in Lakeland Florida commented on the local artist’s win, saying, “Florida’s Click It or Ticket campaign that’s going on right now emphasizes how important wearing safety belts is. We’re so pleased to see that so many students are well aware of that and are eager to promote that idea through their art.”

The poster and video campaign is just one of the many innovative ways GEICO has used community involvement to support auto safety.

Florida Lawsuit Challenges Vicarious Liability Precepts

A report being distributed via the Associated Press, says that the Florida Supreme Court has been urged by an accident victim’s lawyer to rule that rental car companies can be held liable for damages in an accident they did not cause in Florida, despite the existence of a new Federal law intended to shield car rental companies from just such issues.

The legal concept in question, “vicarious liability,” refers to holding non-negligent owners responsible for damages, no matter who was actually driving the vehicle. The 2005 Graves Amendment, a federal law, prohibits such liability, except in states that have insurance or financial responsibility requirements for rental car companies. Representative Samuel Graves (R-MO), the law’s sponsor, believes it will save consumers $100 million a year, nationally.

So what’s the issue in Florida? The Supreme Court is investigating whether or not a Florida “Financial Responsibility” law meets the Federal exception criteria. The existing Florida state law says that if the person who drives or leases a rental vehicle is either uninsured, or has combined insurance limits of less than $500,000, the rental car company, “…shall be liable for up to an additional $500,000 in economic damages.”

Marjorie Gadarian Graham, representing the accident victim, told the court, “It is implicit that there is a requirement to maintain insurance albeit it is not expressly stated.” She also argued that the state legislature intended it to be an insurance requirement and that it’s explicit enough to except Florida from the Graves Amendment.

Enterprise Leasing Company’s attoriney, David C. Boruke, disagreed, and countered by saying, “Nothing is required. It’s an option. It’s an opportunity to make a cost-benefit analysis, but it is not required insurance by any stretch of the imagination.”

A trial judge in Palm Beach County and the 4th District Court of Appeal, in a 6-4 opinion, sided with Enterprise. Accident victim Rafael Vargas’s vicarious liability claim was rejected by both courts. Vargas had been injured when an Enterprise-owned vehicle rear-ended his car in February 2006. Vargas never alleged that the rental car company was at fault or negligent, nor did he allege that the lease was improper.

Despite siding with Enterprise, The 4th District certified the issue to the Supreme Court calling it a “…question of great public importance…” There are severall similar cases on hold pending a ruling, in Flordia, and other states are facing similar issues. One such state is Minnesota, where the state Supreme Court ruled that the Graves Amendment pre-empted a similar state law already on the books there.

Most of the resultant litigation has been at the federal level. The 11th U.S. Circuit Court of Appeals in Atlanta, GA, ruled that Florida’s law was also pre-empted. This means that the Florida court’s decision would apply only to state courts.

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