NU Online News Service, Oct. 28, 3:20 p.m.EDT

The Sunshine State’s system for no-fault automobile insurance isflawed to the point of systemic abuses, and fraudulent claims areclimbing to higher levels than ever, to hear one nationalassociation tell it.

The Property Casualty Insurers Association of America (PCI) onThursday released a special report on Florida’s no-fault autoinsurance, stating that false claims have cost the state’s driversmore than $800 million. “Regrettably, the Florida no-fault systemis completely broken,” Paul Blume, PCI’s senior vice president,state government relations, says in a statement. “Florida’s nofault system is rife with fraud and fraud costs are far worse here,particularly in Florida counties, than in any other no-faultstate.”

Quoting statistics from the National Insurance Crime Bureau,PCI’s report says Florida led the U.S. in staged motor vehicleaccident “questionable claims” between 2007 and 2009. What’s more,it says, four out of the 10 U.S. cities with the highest rate ofquestionable auto claims are in Florida: Tampa, Miami, Orlando andHialeah.

PCI also references the Florida Office of Insurance Regulation’sReport on Review of the 2011 Personal Injury Protection Data Call,which finds that while Florida is seeing a decreasing number ofdrivers, crashes and injuries, the number of personal injuryprotection (PIP) claims that were opened in Florida between 2008and 2010 rose by 35.7 percent.

Titled “Florida’s Automobile No Fault Insurance: A System UnderSiege by Fraud and Abuse,” PCI’s report, citing data from theNational Association of Insurance Commissioners, states thatFlorida drivers currently pay the highest auto-liability insurancepremiums in America, 56 percent more than consumers in other states(annual premiums of $736 in Florida versus $471 elsewhere in theU.S.)

In order to address these issues, PCI offers a four-point planof:

• Allowing a reasonable amount of time to investigate suspiciousclaims.
• Eliminating incentives for frivolous no-fault lawsuits byplacing caps on attorney fees.
• Providing greater oversight of medical clinics by allowingprivate on-site inspections of premises to ensure the services arereal.
• Preventing fraudulent, unnecessary medical treatment byestablishing reasonable treatment limits.

“By passing legislation in the upcoming 2012 Legislative Sessionthat includes these four vital components, the Legislature willhelp close the loopholes that prevent regulators and themarketplace from investigating and fighting fraud,” Blumeadds.

Download the full report here.