Why are Orlando Drivers Paying More for Car Insurance? | Diedrich Law Firm

Why Are Drivers In Orlando Paying More for Car Insurance?

Written by Shawn Diederich on June 20, 2016

Car accidents are on the rise in Florida. According to official statistics published by the Florida Department of Highway Safety and Motor Vehicles, there were 374,095 reported car accidents in 2015, an 8.6 percent increase from 2014, when there were 344,340 crashes. And through the first five-and-a-half months of 2016, there have been 168,749 car accidents, which puts Florida on pace for more than 380,000 crashes by the end of the year.

Why Are There More Car Accidents?

In a recent interview with the Tampa Bay Times, former Florida insurance commissioner Kevin McCarty offered a straightforward explanation for the increase in car accidents: “People are driving more, and accidents have increased commensurate with that number.” As for why people are driving more, that can be attributed primarily to Florida’s population growth, which has been about 8 percent over the five-year period from 2010 to 2015, according to the U.S. Census Bureau. A representative of the insurance industry also suggested to the Times that low unemployment rates—4.8 percent in Florida based on the most recent figures from the U.S. Bureau of Labor Statistics—means, “You have more people with jobs to go to.”

Increasing Car Insurance Rates in Orlando

Even if you have not been in a car accident recently, you may still be paying for the increased statewide crash rate in the form of higher automobile insurance premiums. Insure.com, a consumer information website that tracks the insurance industry, recently cited Florida as having the eighth-highest car insurance premiums in the United States. According to Insure.com’s study, which “compares how much it would cost a driver to buy the same coverage in each state,” Florida consumers currently pay an average of $1,654 for coverage, which is 25 percent higher than the national average and 5 percent more than Floridians paid for the same insurance in 2015.

A key factor in Florida’s higher rates is the state’s “no-fault” insurance law. Florida requires anyone with a motor vehicle registered in the state to purchase and carry at least $10,000 in personal liability protection (PIP) and another $10,000 for property damage liability (PDL). This is considered “no-fault” coverage because it pays benefits regardless of who is responsible for a car accident. Supporters of the no-fault law claim it keeps minor accident cases out of court and ensures victims receive compensation more quickly.

But no-fault laws also mean higher insurance rates for everyone. Indeed, Insure.com noted that Michigan, the state with the highest car insurance rates in the country, also had the strictest no-fault mandate. Unlike Florida, where a driver must only carry $10,000 in PIP coverage (but can elect to purchase more), “Michigan is the only state in the country that requires auto consumers to purchase unlimited, lifetime medical benefits as part of the auto insurance policy.” Consequently, Michigan drivers also pay an average of $2,738 for insurance, more than double the national average.

The Tampa Bay Times noted that PIP-related car insurance premiums have increased 15 percent since last year. And that is only an average: at least one major carrier’s rates have gone up 40 percent. The Times said these rate increases may lead Florida legislators to reconsider the state’s no-fault mandate.

Need Help From an Orlando Personal Injury Lawyer?

Even with expensive no-fault insurance, you may find yourself with more serious injuries and losses due to a car accident than your own policy may cover. In such cases you should speak with an experienced Orlando car accident attorney who can help you seek the compensation that you deserve. Contact the Diederich Law Firm, P.A. today if you require immediate legal assistance.

Posted Under: Car Accidents

Comments are closed.