Florida Car Insurance Rates to Rise

Florida auto insurance premiums are projected to go up by 18% by the start of 2025, increasing the average annual cost from $2,910 to $3,444. Key drivers include attorney advertising and third-party litigation funding (TPLF), which contribute to more claims, prolonged legal processes, and higher settlement amounts.

Striving to be the best Car Accident Lawyer in Miami, Jonathan Perazzo, founder of the Perazzo Law Firm, understands that the moments after an accident that leads to injury, can be daunting for persona injury accident victims. That is why, it is fundamentally important to contact a trusted and dedicated personal injury accident lawyer in Miami following an accident.

A recent report by the Insurance Research Council (IRC) highlights that 60% of people believe attorney advertising increases claims, and 52% say it raises insurance costs. TPLF, a $13.5 billion industry, allows investors to fund lawsuits for a share of settlements, further driving up premiums.

In response, Florida lawmakers are advancing regulatory measures to address the impact of TPLF and widespread attorney advertising on the state’s insurance market. Meanwhile, consumers are encouraged to stay informed, shop for competitive rates, and understand the broader implications of legal involvement in claims.

Contact us ONLINE or CALL 888-PERAZZO now for a FREE CONSULTATION

Understanding Car Insurance Rates for PIP, Bodily Injury, UM, and MedPay in Florida

Florida drivers face some of the highest car insurance premiums in the nation due to the state’s unique insurance requirements and legal landscape. Here’s an overview of the main coverage types—Personal Injury Protection (PIP), Bodily Injury Liability (BI), Uninsured/Underinsured Motorist Coverage (UM), and Medical Payments Coverage (MedPay)—and how they impact insurance rates.

1. Personal Injury Protection (PIP)

What It Covers: PIP is mandatory in Florida and provides coverage for medical expenses, lost wages, and other related costs regardless of fault in an accident. Florida’s no-fault insurance system mandates $10,000 in minimum PIP coverage.
Impact on Rates: PIP significantly increases premiums due to:
- High fraud rates, including staged accidents and inflated medical billing.
- Frequent claims, as PIP is often the first line of coverage for medical expenses.
Average Cost in Florida: PIP coverage alone can account for 20-30% of a driver’s total premium, with costs higher in urban areas like Miami or Tampa.

2. Bodily Injury Liability (BI)

What It Covers: BI covers injuries to others if you are at fault in an accident, including medical expenses, lost wages, and legal fees.
Requirements in Florida: While not required for most drivers, BI is often necessary for drivers who have a history of violations or accidents or are purchasing more comprehensive policies. However, recent legislative changes may make BI mandatory for all drivers.
Impact on Rates:
- BI rates vary based on coverage limits (e.g., $10,000 per person/$20,000 per accident is cheaper than $50,000/$100,000).
- Florida’s high rate of accidents and lawsuits drives up BI premiums.
Average Cost in Florida: Adding BI coverage can increase premiums by 10-20%, depending on the limits chosen.

3. Uninsured/Underinsured Motorist Coverage (UM)

What It Covers: UM protects you if you are injured by a driver who doesn’t have insurance or has insufficient coverage. It also covers hit-and-run accidents, which are common in Florida.
Optional but Recommended: While UM is not mandatory, it is highly recommended due to the state’s high rate of uninsured drivers (estimated at 20%).
Impact on Rates:
- Premiums for UM coverage depend on the policy limits and whether you choose “stacked” or “non-stacked” coverage.
- Stacked UM, which extends coverage across multiple vehicles, costs more but offers broader protection.
Average Cost in Florida: UM coverage typically adds 5-15% to your policy, with higher rates for stacked options.

4. Medical Payments Coverage (MedPay)

What It Covers: MedPay supplements PIP and covers additional medical expenses, such as deductibles or treatments exceeding PIP limits. It is optional in Florida.
Impact on Rates:
- MedPay is less expensive than PIP because it provides more limited coverage.
- It is often purchased as a safeguard against PIP exhaustion or for better peace of mind in severe accidents.
Average Cost in Florida: Adding MedPay typically costs $10-$30 per month, depending on coverage limits (e.g., $5,000 or $10,000).

Key Factors Affecting Rates

Location: Urban areas with high traffic and accident rates (e.g., Miami, Orlando) see higher premiums for all coverage types.
Driver History: A clean driving record can lower BI and UM rates, while accidents or violations can significantly increase costs.
Fraud and Litigation: Florida’s high fraud rates and litigation frequency contribute to the elevated costs of PIP and BI coverage.
Uninsured Drivers: The high percentage of uninsured motorists increases the demand for UM coverage, which affects premiums.

Tips to Save on Car Insurance in Florida

Bundle Coverages: Purchase PIP, BI, UM, and MedPay as part of a bundled policy to get discounts.
Shop Around: Compare quotes from multiple insurers, as rates can vary significantly.
Increase Deductibles: Opting for higher deductibles on PIP or MedPay can reduce premiums.
Take Advantage of Discounts: Look for safe driver, multi-car, or loyalty discounts to offset costs.

By understanding how PIP, BI, UM, and MedPay impact premiums, Florida drivers can make informed decisions about their car insurance coverage while managing costs effectively.

INSURANCE POLICIES FOR FLORIDA MOTORISTS

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