In most situations, an injured person doesn’t have to repay a private passenger Personal Injury Protection (PIP) insurer if he settles a Florida auto accident case.
However, in some commercial vehicle accident cases in Florida, an injured person may have to repay PIP.
What Florida Laws Talk About a PIP Insurer’s Right of Reimbursement?
This law is found in Florida Statutes 627.7405 – Insurers’ right of reimbursement. It says:
“(1) Notwithstanding ss. 627.730-627.7405, an insurer providing personal injury protection benefits on a private passenger motor vehicle shall have, to the extent of any personal injury protection benefits paid to any person as a benefit arising out of such private passenger motor vehicle insurance, a right of reimbursement against the owner or the insurer of the owner of a commercial motor vehicle, if the benefits paid result from such person having been an occupant of the commercial motor vehicle or having been struck by the commercial motor vehicle while not an occupant of any self-propelled vehicle.
(2) The insurer’s right of reimbursement under this section does not apply to an owner or registrant as identified in s. 627.733(1)(b).”
This law has been upheld as constitutional. Basically, this law is valid. Amerisure Ins. Co. v. State Farm Mutual Auto. Ins. Co., 897 So.2d 1287, 1290 (Fla.2005).
This this law applies to every county in Florida.
Does a Personal PIP Insurer Have a Right of Reimbursement Against a Taxicab Insurer?
No. Subsection (2) above means that taxicabs are not subject to this PIP subrogation law.
Driver’s Personal PIP Can Recover From Commercial PIP
Here are the facts from the actual case (not mine) that says that the PIP reimbursement law is valid.
Kelly Edman and her children were injured in an automobile accident. Edman was driving a commercial motor vehicle owned by Wright Construction Corporation. Amerisure insured it.
Edman was not at fault.
After the accident, State Farm, the insurer of Edman’s private passenger motor vehicle, paid personal injury protection (PIP) benefits to Edman in compliance with the Florida Motor Vehicle No-Fault Law.
State Farm requested reimbursement from the commercial vehicle insurer for PIP payments
State Farm then requested reimbursement from Amerisure under the provisions of section 627.7405, requiring insurers of commercial vehicles to reimburse insurers of private vehicles for PIP payments.
Amerisure refused to pay. It argued that it was not obligated to reimburse State Farm because neither Edman nor Wright Construction Corporation was at fault in the accident.
State Farm then sued Amerisure, claiming a right to reimbursement under section 627.7405. The trial court ruled in favor of State Farm’s claim that it was entitled to reimbursement under the statute.
How does this law affect a Personal Injury case?
Let’s take the facts of Kelly Edman’s case above, except assume the commercial vehicle that Kelly was driving was uninsured. Let’s assume that Kelly owned the vehicle.
In that case, State Farm (who paid Kelly’s PIP benefits) could sue Kelly, the commercial vehicle owner, to get reimbursed for the PIP benefits that it paid.
In this instance, Kelly should factor in State Farm’s right of reimbursement when making a claim against any party who caused the accident. This should result in a higher full settlement value of Kelly’s case.
Sending the Personal PIP Insurer a Certain Letter May Kill Their Reimbursement Right
As soon as Kelly decides to make a claim against a tortfeasor, Kelly should send State Farm a letter via certified or registered mail that says that she intends to claim damages from the tortfeasor.
The letter should say that State Farm, as the provider of collateral sources, will waive any rights to subrogation or reimbursement unless it provides Kelly with a statement asserting payments of benefits and right of subrogation or reimbursement within 30 days following receipt of this notice.
If State Farm doesn’t claim a lien in writing to Kelly, within 30 days of receipt of her letter, then State Farm loses its benefits. This can result in Kelly not having to pay State Farm up to $10,000 in PIP benefits.
If Kelly sends this letter, and State Farm doesn’t respond, it could put up to an additional $10,000 in her pocket.
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