How a PIP Deductible Works in a Florida Auto Accident Case

PIP deductible in Florida auto insurance policy — Language from a Florida auto insurance declarations page.

Many Florida auto insurance policies with Personal Injury Protection (PIP) coverage have a deductible. How does a PIP deductible affect payment of your medical bills?

The formula to see how much PIP pays a medical provider is:

PIP payment = (Total bill – PIP deductible) x 80%

Let’s look at some examples to explain how a deductible affects PIP payments.

Example – $1,000 PIP Deductible and $2,781 hospital bill:

Assume you are in a car in Florida, and you are covered by PIP with Progressive. You get treatment at the hospital.

The hospital’s billed charges are $2,781.00. Assume your PIP deductible is $1,000. The formula to determine PIP’s payment to the hospital is as follows:

(Total Hospital Charge – Patient’s PIP deductible)

$2,781.00 minus $1,000 = $1,781.00

Then, multiply this amount by 75% per section 627.736(5)(a)1.b.

$1,781 x 75% = $1,335.75

Next, multiply that times 80% applying section 627.736(5)(a)1.

Per Florida law, Progressive owes 80% of that amount.

$1,335.75 x 80% = $1,068.60

PIP owes the hospital $1,068.60.

What if you are entitled to medical payments (Medpay) coverage?

If you are entitled to medical payments (Medpay) coverage, it will pay the 20% that PIP did not pay. Using the above example:

Medpay payment = ($5,000 – $1,000) x 20%

Medpay payment = $4,000 x 20%

Medpay payment = $800

Medpay would pay $800 to the hospital in this example.

Your out of pocket bills would be $1,000, which is the amount of the PIP deductible.

What if you also have health insurance coverage?

If you have health insurance, you should give this information to the hospital. If you didn’t provide them with your auto insurance card at the time of your visit, you should call them immediately and provide them with your car insurance information.

Your health insurance likely has a contract with the hospital. Using the above example, if the health insurance has a contracted rate for less than the $4,000 that PIP paid the hospital, you would not owe the hospital the deductible.

Can you also make a claim against the at fault driver and owner?

If a driver’s negligence caused your injury, you can also make a claim against the at fault driver or owner’s bodily injury (BI) liability coverage. The claim would be for any outstanding medical bills, lost wages, and pain and suffering.

The negligent driver and owner are two of the 11 parties that may be liable for your damages that are not paid by PIP.

Who does a PIP deductible apply to?

If a deductible was elected, it applies to the named insured alone or to the named insured and dependent relatives residing in the same household. It does not apply to any other person covered under the policy.

You would need to look at the PIP application and the declarations page to see if a deductible was elected.