You just bought a new car. The salesman at the dealership tells you to call your insurance company and get “full coverage”. You are sitting at a red light and some driver behind you, not paying attention, rear-ends your car. The person jumps out and says, “don’t worry – I have full coverage!” What does “full coverage” mean? It means different things to different people.
Technically, the law in the state of Florida requires basic, minimal coverage that could be called “full coverage” since it is all that is required by Florida law. Florida is not a mandatory bodily injury liability state. Before we can talk about “full coverage” let’s first define the various kinds of insurance coverages that are available:
- Property Damage or “PD” coverage. This type of insurance pays for damage you cause to another’s person’s car. Usually, it is a maximum of $10,000. If a person causes a crash which results in the other vehicle being a total loss or sustaining more than $10,000 worth of damage, minimal property damage insurance as required by Florida law is insufficient and the careless driver is responsible financially for the balance.
- Bodily Injury liability or “BI” coverage. This insurance pays for physical injuries a careless driver causes another. It is designed to compensate for any losses, damage or harm that another person suffers because of your bad driving. If the person you injured suffers a permanent injury, they are entitled to seek damages for all of their provable losses which can greatly exceed most minimal policies of $10,000. Bodily injury liability is not required under Florida law and, accordingly, even people with “full coverage” do not usually have enough bodily injury liability insurance.
- Uninsured Motorist coverage or “UM”. This coverage protects you, the insured in the event another person causes you harm, injury or damage and does not have their own insurance (uninsured motorist) or sufficient amounts of insurance (underinsured motorist). In my opinion, this kind of insurance in Florida should be mandatory since most drivers do not carry sufficient bodily injury coverage. Uninsured motorist coverage protects you against the millions of drivers in Florida that simply do not have enough insurance or any bodily injuy insurance at all.
- Personal Injury Protection benefits or “PIP”. Personal injury protection benefits are mandatory under Florida law. Florida is a no-fault state which means your own insurance company pays for the first $10,000 of your medical bills at 80% and your lost wages at 60%. This insurance is designed as a way to avoid lawsuits and litigation in small claims. It has had the opposite effect. It has spawned a tremendous amount of litigation and has encouraged a cottage industry of medical referral services, accident and injury clinics and lawyers that specialize in suing insurance companies for payment of personal injury protection benefits. In my opinion, PIP has become a minefield for the uninformed consumer. For instance, following an accident, a person must receive medical care within 14 days in order to trigger their “benefits”. If a person waits past this time, they will have forfeited their right to PIP benefits and create all sorts of difficulties if they need medical care. PIP has given insurance companies a unique set of rights to conduct examinations by doctors of their choice to discontinue benefits, conduct statements of their insureds under oath and has enabled insurance carriers to send out literally unlimited amounts of information requests, forms and a barrage of paperwork to make the claims process extraordinarily complicated and difficult. The PIP scheme is a failure and should be abolished in favor of mandatory bodily injury liability insurance. PIP or no-fault has also created a threshold for injury which a person must meet or prove to recover damages for such things as pain & suffering, inconvenience, scarring, shame, humiliation, loss of the capacity for the enjoyment of life and other non-economic damages. The threshold requires proof of one of four categories. They are;
- Loss of an important bodily function,
- Significant scarring,
- Permanent injury within a reasonable degree of medical probability.
PIP is required by Florida law and is personal to the insured and insured’s family members. PIP travels with a person’s vehicle, meaning a claimant makes a PIP claim under their own coverage even if they are not in their car at the time of the accident.
- Collision coverage. This insurance pays for damage to your car if you cause a crash or your vehicle is crashed into or damaged.
- Comprehensive coverage. This pays an insured for damage to their car from loss such as theft, vandalism and other mishaps.
- Rental car coverage. This coverage pays for you to rent a car while your car is out of commission. There is usually a set price per day and set number of days on your policy.
- Towing & Storage coverage. This pays for your car’s cost of towing and storage while it is awaiting an estimate for repair.
- GAP insurance. This insurance pays for the difference between the actual cash value of your vehicle and the amount that you owe on your loan or lease.
- Medical payment coverage. This coverage provides benefits for the amount not covered by PIP or coverage over and above your PIP benefits.
- Umbrella coverage. Umbrella coverage means that you have a policy of insurance on top of your underlying coverage which can provide for additional liability insurance or additional uninsured motorist coverage.
- Other coverages/exotic coverages. There are numerous insurance products which provide additional benefits such as extended PIP coverage, Replacement value coverage vs. actual cash value coverage for auto loss, contents coverage which provides for things in your vehicle, cargo coverage for things you may be transporting, rideshare coverage if you are an Uber or Lyft driver, and other kinds of insurance which are unique to specific companies.As you can see from this brief article, there is no such thing as “full coverage” since the sky is the limit as to the amount of insurance a person can carry and the types of coverage they can have on their policy. A claim of having “full coverage” is likely fake news. It is important that you understand the kind of automobile insurance you have to make sure that it is appropriate for you. People with substantial assets need coverage to protect them in the event of an at-fault loss. A wage earner without disability insurance can face financial ruin at the hands of an uninsured or underinsured motorist. These types of protection are often inexpensive supplements to insurance policies.At Jeffrey R. Davis, P.A. we offer our clients a free insurance policy evaluation. We will review your declarations of coverage and advise you as to the kind of coverages you carry and the availability of coverages you lack. Please be sure to consult with our office if you have any questions regarding your insurance coverage or the insurance coverage of an at-fault motorist that has caused a crash.
Jeffrey R. Davis, P.A. has been representing victims of automobile and motor-vehicle accidents since 1986 throughout the state of Florida. Please call (305) 577-3777 for a free case review or free insurance evaluation.