Florida Senate Bill S0150 Analysis / Analysis

                    The Florida Senate 
BILL ANALYSIS AND FISCAL IMPACT STATEMENT 
(This document is based on the provisions contained in the legislation as of the latest date listed below.) 
Prepared By: The Professional Staff of the Committee on Banking and Insurance  
 
BILL: SB 150 
INTRODUCER:  Senators Burgess and Rouson 
SUBJECT:  Motor Vehicle Insurance 
DATE: February 2, 2022 
 
 ANALYST STAFF DIRECTOR  REFERENCE  	ACTION 
1. Knudson Knudson BI Favorable 
2.     JU  
3.     RC  
 
I. Summary: 
SB 150 repeals the Florida Motor Vehicle No-Fault Law (No-Fault Law), which requires every 
owner and registrant of a motor vehicle in this state to maintain Personal Injury Protection (PIP) 
coverage. Beginning July 1, 2023, the bill enacts financial responsibility requirements for 
liability for motor vehicle ownership or operation, as follows: 
 For bodily injury (BI) or death of one person in any one crash, $25,000, and, subject to that 
limit for one person, $50,000 for BI or death of two or more people in any one crash. 
 The existing $10,000 financial responsibility requirement for property damage (PD) is 
retained. 
 
The bill increases required coverage amounts for garage liability and commercial motor vehicle 
insurance. It increases the cash deposit amount required for a certificate of self-insurance 
establishing financial responsibility for owners and operators of motor vehicles that are not for-
hire vehicles. 
 
The bill requires insurers to offer medical payments coverage (MedPay) with limits of $5,000 or 
$10,000 to cover medical expenses of the insured. Insurers may also offer other policy limits that 
exceed $5,000. Insurers must offer a zero deductible option for MedPay, and may also offer 
deductibles of up to $500. Insurers must reserve $5,000 of MedPay benefits for 30 days to pay 
physicians or dentists who provide emergency services and care or who provide hospital 
inpatient care. 
 
The repeal of the No-Fault Law eliminates the limitations on recovering pain and suffering 
damages from PIP insureds, which currently require bodily injury that causes death or significant 
and permanent injury. Under the bill, the legal liability of an uninsured motorist insurer includes 
damages in tort for pain, suffering, disability or physical impairment, disfigurement, mental 
anguish, inconvenience, and the loss of past and future capacity for the enjoyment of life. 
 
REVISED:   BILL: SB 150   	Page 2 
 
The bill also requires that each insurance policy issued for the purpose of meeting financial 
responsibility requirements must include a $5,000 death benefit. 
 
The bill creates a new framework to govern all claims against motor vehicle insurers for bad 
faith failure to settle a third-party claim. The bill sets forth best practice claim handling standards 
that a motor vehicle insurer is subject to upon the earlier of receiving actual notice of an incident 
or loss that could give rise to a covered liability claim and remains subject to the best practices 
standards until the claim is resolved. The insurer has a duty to its insured to handle claims in 
good faith by complying with the best practices standards. Bad faith failure to settle occurs when 
an insurer fails to meet that duty of good faith, which is a proximate cause of the insurer not 
settling a third-party claim when, under all the circumstances, it could and should have done so, 
had it acted fairly and honestly toward its insured and with due regard for the insured’s interests. 
If the insurer meets the best practices standards, the bill provides safe harbors for the purpose of 
allowing the insurer a reasonable opportunity to investigate and evaluate the claim. This is done 
by establishing time periods during which an insurer does not commit bad faith by failing to 
tender policy limits. The safe harbors are available to an insurer that meets the best practices 
standards and provide that: 
 When one claim arises out of a single occurrence, and an insurer initiates settlement 
negotiations by tendering the applicable policy limits in exchange for a general release of 
the insured within 45 days after receiving actual notice of the loss, the failure to tender 
the policy limits sooner does not constitute bad faith. 
 When multiple claims arise out of a single occurrence, the combined value of all claims 
exceeds the total of all applicable policy limits, and an insurer initiates settlement 
negotiations by globally tendering the applicable policy limits in exchange for a general 
release of the insured within 45 days after receiving actual notice of the loss, the failure 
to tender policy limits sooner does not constitute bad faith. 
 An insurer is not under any circumstances liable for the failure to accept a settlement 
offer within 45 days after receiving actual notice of the loss if: 
o The settlement offer provides the insurer fewer than 15 days for acceptance; or 
o The settlement offer provides the insurer fewer than 30 days for acceptance where 
the offer contains conditions for acceptance other than the insurer’s disclosure of 
its policy limits. 
 
The bill provides that for any award of noneconomic damages, a defendant is entitled to a 
$10,000 setoff if a person suffers injury while operating a motor vehicle which was not in 
compliance with the financial responsibility law for more than 30 days immediately preceding 
the crash. The setoff on noneconomic damages does not apply if the person who is liable for the 
injury was driving under the influence; acted intentionally, recklessness, or with gross 
negligence; fled from the scene of the crash; or was acting in furtherance of a felony offense or 
in immediate flight from a felony offense. This setoff does not apply to wrongful death claims. 
 
The bill provides that the claimant may file an action to enforce the section and is entitled to an 
award of reasonable attorney fees and costs to be paid by the insurer if an insurer fails to timely 
comply with the requirements of s. 627.4137, F.S., which requires liability insurers to provide, 
within 30 days after receiving a written request from a clamant, a sworn statement setting forth 
the name of the insurer, name of the insured, limits of liability coverage, a statement of any  BILL: SB 150   	Page 3 
 
policy or coverage defense the insurer currently believes is reasonably available to it, and a copy 
of the insurance policy. 
 
The effective date of the bill is July 1, 2023. 
II. Present Situation: 
Motor Vehicle Insurance 
The first recorded motor vehicle accident occurred in Ohio City, Ohio, in 1891.
1
 Only 6 years 
later, the first automobile liability insurance policy would be issued by Travelers Insurance 
Company in Dayton, Ohio, protecting the driver if his vehicle killed or injured someone or 
damaged their property.
2
 These coverages today are provided through bodily injury liability and 
property damage liability insurance. In 1925, Connecticut passed the first financial responsibility 
law requiring owners of automobiles to demonstrate the ability to financially respond when they 
are at fault for damages caused to other persons and property. As the automobile became a 
ubiquitous part of American life, more states passed financial responsibility laws. Today, every 
state has a financial responsibility law regarding owning or operating a motor vehicle.  
 
All states except New Hampshire require the purchase of property damage coverage, which pays 
for any damage the insured causes to the property of others.
3
 Every state, except Florida and 
New Hampshire, requires bodily injury liability coverage (BI), which covers an insured that is at-
fault in an accident for damages related to the bodily injuries of others negligently caused by the 
insured.
4
 Bodily injury liability coverage does not provide coverage for an insured’s own 
injuries. The most common minimum mandatory limit of bodily injury coverage – mandated by 
34 states – is $25,000 in coverage for injuries to any one person and $50,000 in coverage for 
injuries to multiple persons, subject to the $25,000 limit for one person. This is often referred to 
as limits of $25,000/$50,000. Of the 48 states that require BI coverage, the lowest mandatory 
limit is $15,000/$30,000. The highest required limit is $50,000/$100,000. The following table 
details the financial responsibility insurance coverage requirements by state: 
 
                                                
1
 https://ohiohistorycentral.org/w/World%27s_First_Automobile_Accident  
2
 https://ohiohistorycentral.org/w/World’s_First_Automobile_Insurance_Policy?rec=2597. 
3
 National Association of Insurance Commissioners, Overview – Auto Insurance 
https://content.naic.org/article/consumer_insight_does_your_vehicle_have_right_protection_best_practices_buying_auto_ins
urance.htm (last accessed January 26, 2021). 
4
 See id.   BILL: SB 150   	Page 4 
 
FINANCIAL RESPONSIBILITY REQUIREMENTS BY STAT E 
ST Minimum Limits (thousands) ST Minimum Limits (thousands) 
  
AL BI 25/50 PD 25 	MT BI 25/50 PD 20 
AK BI 50/100 PD 25 	NE BI 25/50 PD 25 UM 25/50 
AZ BI 25/50 PD 15 	NV BI 25/50 PD 20 
AR BI 25/50 PD 25 	NH Financial Responsibility Only
5
 
CA BI 15/30 PD 5 	NJ BI
6
 15/30 PD 5 PIP
7
 15 
CO BI 25/50 PD15 	NM BI 25/50 PD 10 
CT BI 25/50 PD 25 UM 25/50 NY BI
8
 25/50 PD 10 PIP 50 
DE BI 25/50 PD 10 PIP 15/30 NC BI 30/60 PD 25 UM 30/60/25 
FL PIP 10 PD 10 	ND BI 25/50 PD 25 UM 25/50 PIP 30 
GA BI 25/50 PD 25 	OH BI 25/50 PD 25 
HI BI 20/40 PD 10 PIP 10 OK BI 25/50 PD 25 
ID BI 25/50 PD 15 	OR BI 25/50 PD 20 UM 25/50 PIP 15 
IL BI 25/50 PD 20 UM 25/50 PA BI 15/30 PD 5 Med 5 
IN BI 25/50 PD 25 	RI BI 25/50 PD 25  
IA BI 20/40 PD 15 	SC BI 25/50 PD 25 UM 25/50/25 
KS BI 25/50 PD 25 PIP
9
  	SD BI 25/50 PD 25 UM 25/50 
KY BI 25/50 PD 25 	TN BI 25/50 PD 15 
LA BI 15/30 PD 25 	TX BI 30/60 PD 25 
ME BI 50/100 PD 25 Med 2 UM 50/100 UT BI 25/65 PD 15 PIP 3 
MD BI 30/60 PD 15 UM 30/60/15 VT BI 25/50 PD 10 UM 50/100/10 
MA BI 20/40 PD 5 UM 20/40 PIP 8 VA BI 25/50 PD 20 UM 25/50/20 
MI BI 20/40 PD 10 PIP
10
 PPI 1000 WA BI 25/50 PD 10 
MN BI 30/60 PD 10 PIP 40 UM 25/50 WV BI 25/50 PD 25 UM 25/50/25 
MS BI 25/50 PD 25 	WI BI 25/50 PD 10 UM 25/50 
MO BI 25/50 PD 20 UM 25/50 WY BI 25/50 PD 20 
 
                                                
5
 New Hampshire does not require the purchase of insurance to meet the state’s financial responsibility law, but drivers that 
purchase insurance must do so at minimum limits of $25,000/$50,000 for BI, $25,000 for PD, and $1,000 for medical 
payments coverage. 
6
 New Jersey allows drivers to purchase a “basic policy” that only includes $5,000 of PD, $15,000 of PIP, and an optional 
$10,000 for BI. 
7
 The New Jersey PIP benefit provides $250,000 in benefits for specified severe injuries. 
https://www.state.nj.us/dobi/division_consumers/insurance/basicpolicy.shtml (last accessed Jan. 31, 2022). 
8
 New York requires that BI limits be at least $50,000/$100,000 for death. https://dmv.ny.gov/insurance/insurance-
requirements (last accessed January 31, 2022). 
9
 Kansas PIP coverage must provide $4,500 per person for medical expenses, $900 per month for 1 year for disability or loss 
of income, $25 per day for in-home services, $2,000 for funeral expenses, $4,500 for rehabilitation expenses, survivor 
benefits for loss of income up to $900 per month for 1 year. 
10
 Michigan changed its mandatory PIP medical coverage effective July 1, 2020. Previously, Michigan required PIP coverage 
with no maximum limit. Now, Michigan requires the purchase of PIP coverage with a coverage limit of at least $250,000. 
However, Medicaid enrollees may purchase only $50,000 in PIP coverage if other household members have an auto 
insurance policy or health insurance covering accidents. A Medicare enrollee (parts A and B) may opt-out of PIP if their 
household members have an auto insurance policy or health insurance covering auto accidents. 
https://www.michigan.gov/documents/autoinsurance/MI_New_Auto_Ins_Law_678454_7.pdf (last accessed Jan. 31, 2022).  BILL: SB 150   	Page 5 
 
Florida’s Financial Responsibility Law 
Florida’s financial responsibility law exists to ensure that the privilege of owning or operating a 
motor vehicle on the public streets and highways is exercised with due consideration for others 
and their property, to promote safety, and to provide financial security requirements for the 
owners or operators of motor vehicles who are responsible to recompense others for injury to 
person or property caused by a motor vehicle.
11
 The financial responsibility law requires drivers 
of motor vehicles with 4 or more wheels to purchase both personal injury protection (PIP) and 
property damage liability (PD) insurance.
12
 Florida law does not require insurance coverage for 
motorcycles; however, if a motorcyclist is involved in an accident, that person’s license and 
registration are subject to suspension if insurance was not purchased. 
 
A driver in compliance with the requirement to carry PIP coverage is not required to maintain 
bodily injury liability coverage, except that Florida law requires proof of ability to pay monetary 
damages for bodily injury and property damage liability arising out of a motor vehicle accident 
or serious traffic violation.
13
 The owner and operator of a motor vehicle need not demonstrate 
financial responsibility, i.e., obtain BI and PD coverages, until after the accident.
14
 At that time, 
a driver’s financial responsibility is proved by the furnishing of an active motor vehicle liability 
policy. The minimum amounts of liability coverages required are $10,000 in the event of bodily 
injury to, or death of, one person, $20,000 in the event of injury to, or death of, two or more 
persons, and $10,000 in the event of damage to property of others, or $30,000 combined BI/PD 
policy.
15
 The driver’s license and registration of the driver who fails to comply with the security 
requirement to maintain PIP and PD insurance coverage is subject to suspension.
16
 A driver’s 
license and registration may be reinstated by obtaining a liability policy and by paying a fee to 
the Department of Highway Safety and Motor Vehicles.
17
 
 
Personal injury protection (PIP) insurance compensates insureds injured in accidents regardless 
of fault.
18
 Policyholders are indemnified by their own insurer. The intent of no-fault insurance is 
to provide prompt medical treatment without regard to fault.
19
 This coverage also provides 
policyholders with immunity from liability for economic damages up to the policy limits and 
limits tort suits for non-economic damages (pain and suffering) below a specified injury 
threshold.
20
 In contrast, under a tort liability system, the negligent party is responsible for 
damages caused and an accident victim can sue the at-fault driver to recover economic and non-
economic damages. The concept of PIP insurance was developed during the 1960’s in response 
to concerns that began to be voiced regarding some of the perceived shortcomings of the tort 
system, in particular its ability to handle automobile accident claims in an accurate and 
                                                
11
 Section 324.011, F.S. 
12
 See ss. 324.022, F.S. and 627.733, F.S. 
13
 See ch. 324, F.S. 
14
 Section 324.011, F.S. 
15
 Section 324.022, F.S. 
16
 Section 324.0221(2), F.S. 
17
 Section 324.0221(3), F.S. 
18
 Section 627.733, F.S. 
19
 See s. 627.731, F.S. 
20
 Section 627.737, F.S.  BILL: SB 150   	Page 6 
 
expeditious fashion.
21
 The proposed solution was the “no-fault” system in which each driver 
insures him or herself for bodily injuries caused by an auto accident, and to the extent of that 
first-party coverage, tort claims based on fault would be abandoned. Florida is one of 12 no-fault 
states that requires PIP coverage as part of its financial responsibility law, but the only one of 
those states that does not also require BI coverage.
22
 
 
In Florida, personal injury protection must provide a minimum benefit of $10,000 for bodily 
injury to any one person who sustains an emergency medical condition, which is reduced to a 
$2,500 limit for medical benefits if a treating medical provider does not determine an emergency 
medical condition existed.
23
 PIP coverage provides reimbursement for 80 percent of reasonable 
medical expenses,
24
 60 percent of loss of income,
25
 and 100 percent of replacement services,
26
 
for bodily injury sustained in a motor vehicle accident, without regard to fault. A $5,000 death 
benefit is also provided.
27
 The property damage liability coverage must provide a $10,000 
minimum benefit.  
 
PIP Medical Benefits 
The 2012 Legislature revised the provision of PIP medical benefits under the No-Fault Law, 
effective January 1, 2013.
28
 To receive PIP medical benefits, insureds must receive initial 
services and care within 14 days after the motor vehicle accident.
29
 Initial services and care are 
only reimbursable if lawfully provided, supervised, ordered or prescribed by a licensed 
physician, licensed osteopathic physician, licensed chiropractic physician, licensed dentist, or if 
rendered in a hospital or in a facility that owns or is owned by a hospital, or if provided by a 
licensed emergency transportation and treatment provider.
30
 Follow-up services and care require 
a referral from such providers and must be consistent with the underlying medical diagnosis 
rendered when the individual received initial services and care.
31
 
 
PIP medical benefits have two different coverage limits, based upon the severity of the medical 
condition of the individual. An insured may receive up to $10,000 in medical benefits for 
services and care if a physician, osteopathic physician, dentist, physician’s assistant or advanced 
registered nurse practitioner has determined that the injured person had an emergency medical 
condition.
32
 An emergency medical condition is defined as a medical condition manifesting itself 
by acute symptoms of sufficient severity that the absence of immediate medical attention could 
reasonably be expected to result in serious jeopardy to patient health, serious impairment to 
                                                
21
 Florida Senate Banking and Insurance Committee, Florida’s Motor Vehicle No-Fault Law, pg. 6, Report No. 2006-102 
(Nov. 2005). 
22
 Insurance Information Institute, Background on: No-Fault Auto Insurance. https://www.iii.org/article/background-on-no-
fault-auto-insurance (last accessed January 31, 2022). 
23
 Section 627.736(1), F.S. 
24
 Section 627.736(1)(a), F.S. 
25
 Section 627.736(1)(b), F.S. 
26
 Id. 
27
 Section 627.736(1)(c), F.S. 
28
 Chapter 2012-197, L.O.F. (CS/CS/HB 119). 
29
 Section 627.736(1)(a), F.S. 
30
 Section 627.736(1)(a)1., F.S. 
31
 Section 627.736(1)(a)2., F.S. 
32
 Section 627.736(1)(a)3., F.S.  BILL: SB 150   	Page 7 
 
bodily functions, or serious dysfunction of a body organ or part.
33
 If a provider who rendered 
treatment or services does not determine that the insured had an emergency medical condition, 
the PIP medical benefit limit is $2,500.
34
 Massage and acupuncture are not reimbursable, 
regardless of the type of provider rendering such services.
35
 
 
The $5,000 PIP death benefit is provided in addition to medical and disability benefits, effective 
January 1, 2013. Previously, the death benefit was the lesser of the unused PIP benefits, up to a 
limit of $5,000. 
 
Tort-Based Motor Vehicle Insurance Jurisdictions 
In a tort-based liability system, auto injury claimants seek payment from the at-fault driver for 
both economic and non-economic damages, regardless of the dollar amount or severity of the 
injuries. A tort-based system represents a more traditional legal philosophy of holding persons 
responsible for injuries caused by their negligent operation of a vehicle. In theory, this 
encourages safer operation of automobiles and is generally viewed by the public as consistent 
with the concept of personal responsibility. 
 
Bad Faith 
Common Law and Statutory Bad Faith 
Bad faith law was designed to protect insureds who have paid their premiums and who have 
fulfilled their contractual obligations by cooperating fully with their insurer in the resolution of 
claims. Bad faith jurisprudence holds insurers accountable for failing to fulfill their obligations.
36
 
There are two distinct but very similar types of bad faith causes of action that may be initiated 
against an insurer: first-party and third-party. 
 
Florida courts have recognized common law third-party bad faith causes of action since 1938.
37
 
A third-party bad faith cause of action arises when an insurer fails in good faith to settle a third 
party’s claim against the insured within policy limits and exposes the insured to liability in 
excess of his or her insurance coverage.
38
 Third-party bad faith causes of actions arose in 
response to the argument that there was a practice in the insurance industry of rejecting without 
sufficient investigation or consideration claims presented by third parties against an insured, 
thereby exposing the insured individual to judgments exceeding the coverage limits of the policy 
while the insurer remained protected by a policy limit.
39
 With no actionable remedy, insureds in 
this state and elsewhere were left personally responsible for the excess judgment amount.
40
 
Florida courts recognized common law third-party bad faith causes of action in part because the 
                                                
33
 Section 627.732(16), F.S. 
34
 Section 627.736(1)(a)4., F.S. 
35
 Section 627.736(1)(a)5., F.S. 
36
 Harvey v. GEICO General Insurance Company, 251 So.3d 1, 6, (Fla. 2018)(quoting Berges v. Infinity Insurance Company, 
896 So.2d 665 at 682). 
37
 Auto Mut. Indem. Co. v. Shaw, 184, So. 852 (Fla. 1938). 
38
 Opperman v. Nationwide Mutual Fire Insurance Company, 515 So.2d 263, 265 (Fla. 5th DCA 1987). 
39
 Allstate Indem. Co. v. Ruiz, 899 So.2d 1121, 1125 (Fla. 2005). 
40
 Id.  BILL: SB 150   	Page 8 
 
insurers had the power and authority to litigate or settle any claim, and thus owed the insured a 
corresponding duty of good faith and fair dealing in handling these third-party claims.
41
 
 
In contrast to common law third-party bad faith causes of action, Florida courts do not recognize 
a common law first-party bad faith cause of action by the insured against its own insurer.
42
 If an 
insurer acts in bad faith in settling a claim filed by its insured, the only common law remedy 
available to the insured is a breach of contract action against its own insurer with recoverable 
damages limited to those contemplated by the parties to the policy.
43
 
 
The 1982 Legislature’s enactment of s. 624.155, F.S., created a statutory first-party bad faith 
cause of action,
44
 codified Florida Supreme Court precedent authorizing a common-law third-
party bad faith cause of action,
45
 and eliminated the distinction between statutory first- and third-
party bad faith causes of action.
46
  
 
Section 624.155, F.S., provides that any party may bring a bad faith action against an insurer, 
and defines bad faith on the part of the insurer as: 
 Not attempting in good faith to settle claims when, under all the circumstances, it could and 
should have done so, had it acted fairly and honestly toward its insured with due regard for 
her or his interests; 
 Making claims payments to insureds or beneficiaries not accompanied by a statement setting 
forth the coverage under which payments are being made; or 
 Except as to liability coverages, failing to promptly settle claims, when the obligation to 
settle the claim has become reasonably clear, under one portion of the insurance policy 
coverage in order to influence settlements under other portions of the insurance policy 
coverage.
47
 
 
Civil Remedy Notice 
As a condition precedent to bringing a bad faith action under s. 624.155, F.S., the insured must 
have provided the insurer and the Department of Financial Services at least 60 days written 
notice of the alleged violation.
48
 The notice must specify the following information: 
 The statutory provision, including the specific language of the statute, which the authorized 
insurer allegedly violated; 
 The facts and circumstance giving rise to the violation; 
 The name of any individual involved in the violation; 
 A reference to specific policy language that is relevant to the violation, if any. If the person 
bringing the civil action is a third-party claimant, she or he shall not be required to reference 
                                                
41
 Id. 
42
 State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So.2d 55, 58-59 (Fla. 1995). 
43
 Talat Enterprises, Inc. v. Aetna Cas. and Sur. Co., 753 So.2d 1278, 1281 (Fla. 2000). 
44
 Chapter 82-243, s. 9, L.O.F. 
45
 Macola v. Government Employees Ins. Co., 953 So.2d 451, 456 (Fla. 2006). See also State Farm Fire & Cas. Co. v. 
Zebrowski, 706 So.2d 275, 277 (Fla. 1997). 
46
 Id.  
47
 Section 624.155(1)(b)(1)-(3), F.S. 
48
 Section 624.155(3), F.S.  BILL: SB 150   	Page 9 
 
the specific policy language if the authorized insurer has not provided a copy of the policy to 
the third party claimant pursuant to written request; and 
 A statement that the notice is given in order to perfect the right to pursue the civil remedy 
authorized under s. 624.155, F.S.
49
 
 
The 60-day window contemplated under s. 624.155, F.S., provides insurers with a final 
opportunity to comply with their claim-handling obligations when a good-faith decision by the 
insurer would indicate that contractual benefits are owed.
50
 If the insurer in turn fails to respond 
to a civil remedy notice within the 60-day window, there is presumption of bad faith sufficient to 
shift the burden to the insurer to show why it did not respond.
51
 
 
In Talat Enterprises, Inc. v. Aetna Cas. and Sur. Co., the Florida Supreme Court addressed the 
question of whether an insurer that paid all contractual damages within the 60-day window, but 
none of the extra-contractual damages, satisfied the requirement for payment of damages under 
s. 624.155(3)(c), F.S., thereby precluding the claimant’s bad faith action. The Florida Supreme 
Court answered in the affirmative, explaining: 
 
Section 624.155 does not impose on an insurer the obligation to pay whatever the insured 
demands. The 60-day window is designed to be a cure period that will encourage 
payment of the underlying claim, and avoid unnecessary bad faith litigation. Surely an 
insurer need not immediately pay 100 percent of the damages claimed to flow from bad 
faith conduct in order to avoid the chance that the insured will succeed on a bad faith 
cause of action. If the insurer may avoid a bad faith action only by paying in advance 
every penny of the damages that it faces if it loses at trial, the insurer would have no 
reason to pay.
52
 
 
Legal Standard of Proof 
Each bad faith case is determined on its own facts and ordinarily the question of failure to act in 
good faith with due regard for the interests of the insured is for the jury.
53
 In Florida, the question 
of whether an insurer has acted in bad faith in handling claims against the insured is determined 
under a “totality of the circumstances” standard.
54
 In Harvey v. Geico General Insurance 
Company, the Florida Supreme Court explained that the critical inquiry in a bad faith case is 
whether “the insurer diligently, and with the same haste and precision as if it were in the 
insured’s shoes, worked on the insured’s behalf to avoid an excess judgment.”
55
 The claimant 
bringing the bad faith action has the burden of proving the insurer acted in bad faith by a 
preponderance of the evidence.
56
 
 
                                                
49
 Section 624.155(3)(b)(1)-(5), F.S. 
50
 See Talat Enterprises, Inc., 753 So.2d at 1284. 
51
 Fridman v. Safeco Ins. Co. of Illinois, 185 So.3d 1214, 1220, (Fla. 2016); Imhof v. Nationwide Mut. Ins. Co., 643 So.2d 
617, 619 (Fla 1994). 
52
 See Talat Enterprises, Inc., 753 So.2d at 1282. (quoting Talat Enterprises, Inc. v. Aetna Cas. & Sur. Co., 952 F.Supp. 773, 
778 (M.D.Fla.1996)). 
53
 Boston Old Colony Insurance Company v. Gutierrez, 386 So.2d 783, 785 (Fla. 1980). 
54
 Berges v. Infinity Insurance Company, 896 So.2d 665, 680 (Fla. 2005). 
55
 See Harvey, 259 So.3d at 7. 
56
 Cadle v. GEICO General Insurance Company, 838 F.3d 1113, 1119 (11th Cir. 2016).   BILL: SB 150   	Page 10 
 
The Florida Supreme Court in Boston Old Colony Ins. v. Gutierrez explained why insurers have 
a duty of good faith to their insured: 
 
An insurer, in handling the defense of claims against its insured, has a duty to use 
the same degree of care and diligence as a person of ordinary care and prudence 
should exercise in the management of his own business. For when the insured has 
surrendered to the insurer all control over the handling of the claim, including all 
decisions with regard to litigation and settlement, then the insurer must assume a 
duty to exercise such control and make such decisions in good faith and with due 
regard for the interests of the insured.
57
 (citations omitted) 
 
The court further explained what constitutes good faith claims handling: 
 
This good faith duty obligates the insurer to advise the insured of settlement opportunities, to 
advise as to the probable outcome of the litigation, to warn of the possibility of an excess 
judgment, and to advise the insured of any steps he might take to avoid same. The insurer must 
investigate the facts, give fair consideration to a settlement offer that is not unreasonable under 
the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of 
paying the total recovery, would do so. (citations omitted)  
III. Effect of Proposed Changes: 
Repeal of the Florida Motor Vehicle No-Fault Law 
Section 1 repeals ss. 627.730-627.7405, F.S., which constitute the Florida Motor Vehicle No-
Fault Law. 
 
The most significant provisions repealed are s. 627.733, F.S., which contains the requirement to 
maintain PIP coverage, s. 627.736, F.S., which sets forth the benefits that PIP coverage must 
provide, and the tort exemption in s. 627.737, F.S., which prohibits tort actions to recover pain 
and suffering damages from PIP insureds unless death or significant and permanent injury causes 
such damages, and coverage for disability and death benefits under PIP. 
 
Section 2 repeals s. 627.7407, F.S., which provided for how the Florida Motor Vehicle No-Fault 
Law was to be applied after being reinstated by ch. 2007-324, Laws of Florida. 
 
Mandatory Bodily Injury Liability Coverage Requirements 
Chapter 324, F.S., requires the owners and operators of motor vehicles to demonstrate the ability 
to respond to damages for liability because of crashes arising out of the use of a motor vehicle.
58
 
This requirement is usually met through the purchase of motor vehicle insurance.  
 
                                                
57
 Boston Old Colony Ins. v. Gutierrez, 386 So.2d 783 (Fla. 1980).  
58
 Owners and operators of motor vehicles may satisfy financial responsibility requirements by alternate means, such as 
depositing security with the Department of Highway Safety and Motor Vehicles pursuant to s. 324.161, F.S., or qualifying as 
a self-insurer pursuant to s. 324.171, F.S.  BILL: SB 150   	Page 11 
 
Sections 13 and 14 amend ss. 324.021 and 324.022, F.S., respectively, to require beginning July 
1, 2023, that every owner or operator of a motor vehicle that is registered in this state maintains 
the ability to respond to damages for liability that results from accidents arising out of the 
ownership, maintenance, or use of a motor vehicle that is not a commercial motor vehicle, 
nonpublic sector bus, or for-hire passenger transportation vehicle as follows: 
 For BI or death of one person in any one crash, $25,000. 
 Subject to that limit for one person, $50,000 for BI or death of two or more people in any one 
crash. 
 
The bill retains current law that requires drivers to maintain the ability to respond to damages of 
$10,000 for damage to, or the destruction of, other’s property in a crash. 
 
An owner or operator may meet the financial responsibility requirement by obtaining motor 
vehicle insurance that provides BI and PD coverage in at least the minimum amounts required to 
meet responsibility, or through insurance that provides BI and PD with a combined single 
coverage limit that equals the BI requirement for more than one person plus the PD requirement. 
Beginning July 1, 2023, the minimum combined single limit will be $60,000. An owner or 
operator may also meet financial responsibility requirements through alternate methods 
authorized under s. 324.031, F.S., such as furnishing a certificate of self-insurance under 
s. 324.161, F.S., or s. 324.171, F.S. 
 
Other vehicle types are excluded from the definition of a motor vehicle in s. 324.031(2)(a), F.S., 
and instead are subject to financial responsibility requirements of different sections of statute: 
 Commercial motor vehicles are subject to s 324.031, F.S., and s. 627.7415, F.S. 
 For-hire passenger transportation vehicles are subject to s. 324.032, F.S  
 School buses are subject to s. 316.615, F.S. 
 Nonpublic sector buses are subject to s. 324.031, F.S., and s. 627.742, F.S. 
 
Motorcycles are not required to meet the foregoing requirements established by the bill, as the 
bill retains current law in s. 324.022, F.S., which defines motor vehicles for purposes of that 
section as self-propelled vehicles with four or more wheels. However, as under current law, if a 
motorcycle is involved in a crash and caused bodily injury to another, the license of the operator 
and registration of the motorcycle is subject to suspension under s. 324.051, F.S., if the operator 
or owner did not have a motor vehicle liability policy in effect at the time of the crash. 
 
Required Provisions in Motor Vehicle Liability Policies 
Section 23 amends s. 324.151, F.S., which requires motor vehicle liability insurance policies that 
serve as proof of financial responsibility under s. 324.031(a), F.S. The bill requires policies 
issued to the owner of a motor vehicle that is required to be registered in this state to insure all 
named insureds, except for a named driver excluded pursuant to new s. 727.747, F.S., discussed 
below; and to also insure: 
 Any resident relative
59
 of a named insured, and 
                                                
59
 Defined in this section to mean” a person related to a named insured by any degree by blood, marriage, or adoption, 
including a ward or foster child, who usually makes his or her home in the same family unit or residence as the named 
insured, whether or not he or she temporarily lives elsewhere.”  BILL: SB 150   	Page 12 
 
 Any operator using the vehicle with the permission of the owner of the vehicle insured by the 
policy from liability resulting from the use of the motor vehicle referenced in the policy.  
 
The bill authorizes an insurer to include provisions in its policy excluding coverage for a motor 
vehicle not designated as an insured vehicle on the policy if such motor vehicle does not qualify 
as a newly acquired vehicle,
60
 does not qualify as a temporary substitute vehicle,
61
 and was 
owned by the insured or furnished for an insured’s regular use for more than 30 consecutive days 
before an event giving rise to a claim.  
 
A motor vehicle liability insurance policy issued to a person who does not own a motor vehicle 
must insure the named insureds against liability for damages arising out of the use of any motor 
vehicle not owned by the named insureds. 
 
All motor vehicle liability policies providing coverage for accidents occurring within the United 
States or Canada must provide liability coverage having the minimum limits of $25,000 for BI or 
death of one person in any one crash, $50,000 for BI or death of two or more people in any one 
crash, and $10,000 for PD. 
 
Section 47 amends s. 627.7275, F.S., to require all motor vehicle insurance policies delivered or 
issued in Florida for a motor vehicle registered or principally garaged in this state to include the 
minimum limits of BI liability coverage and PD liability coverage as required by s. 324.022, 
F.S., and the death benefit coverage required under s. 627.72761, F.S. 
 
Motor vehicle insurance under policies made available to applicants seeking reinstatement of the 
applicant’s driving privileges after such privileges were revoked or suspended for driving under 
the influence must provide coverage of at least the minimum limits of BI and PD liability 
coverage under s. 324.021(7), F.S.,
62
 or s. 324.023, F.S.
63
 These sections require drivers who 
plead guilty or nolo contendere to a charge of driving under the influence to meet additional 
liability insurance requirements. 
 
Meeting Financial Responsibility through a Certificate of Self-Insurance 
Section 18 amends s. 324.031, F.S., which allows owners and operators of motor vehicles that 
are not for-hire vehicles to prove financial responsibility by providing evidence of holding a 
motor vehicle liability policy covering the motor vehicle being operated. Two alternatives are 
also available under the statute. Such persons may prove financial responsibility by furnishing a 
certificate of self-insurance that shows a deposit of cash with a financial institution, or furnishing 
a certificate of self-insurance issued by the DHSMV based on demonstrating sufficient net 
unencumbered worth.  
 
                                                
60
 Defined in this section to mean “a vehicle owned by a named insured or resident relative of the named insured which was 
acquired within 30 days before an accident.” 
61
 Defined in this section to mean “any motor vehicle, as defined in s. 320.01(1), F.S., which is not owned by the named 
insured and which is temporarily used with the permission of the owner as a substitute for the owned motor vehicle 
designated on the policy when the owned vehicle is withdrawn from normal use because of breakdown, repair, servicing, 
loss, or destruction.” 
62
 $25,000/$50,0000 for BI or death and $10,000 for PD. 
63
 $100,000/$300,000 for BI or death and $50,000 for PD.  BILL: SB 150   	Page 13 
 
Under the bill, a person furnishing a certificate of self-insurance showing a deposit of cash must, 
beginning July 1, 2023, furnish a certificate of deposit equal to the number of vehicles owned 
times $60,000, to a maximum of $240,000. Current law requires a deposit equal to the number of 
vehicles times $30,000, to a maximum of $120,000. All persons using this method must maintain 
insurance coverage having limits of at least $125,000/$250,000/$50,000 BI/PD or a $300,000 
BI/PD combined single limit. Under current law, this coverage must be maintained as an excess 
coverage in excess of $10,000/$20,000/$10,000 BI/PD or $30,000 combined single limits.  
 
Under Section 24 of the bill amending s. 324.161, F.S., the proof of a certificate of deposit must 
be provided annually, and must be from a financial institution insured by the Federal Deposit 
Insurance Corporation or the National Credit Union Administration. 
 
The second alternative method is obtaining a certificate of self-insurance issued by the DHSMV. 
Section 25 amends s. 324.171, F.S., effective July 1, 2023, to provide that a certificate of self-
insurance from the DHSMV issued pursuant to this section may be obtained by a private 
individual with private passenger vehicles by demonstrating sufficient net unencumbered worth 
of at least $100,000. Current law requires a net unencumbered worth of at least $40,000. A 
person, other than a natural person, may obtain a certificate of self-insurance from the DHSMV 
by possessing a net unencumbered worth of at least $100,000 for the first motor vehicle and 
$50,000 for each additional vehicle. Current law requires a net unencumbered worth of $40,000 
for the first motor vehicle and $20,000 for each additional motor vehicle. The bill retains current 
law that authorizes the DHSMV to promulgate by rule an alternative net worth requirement for 
persons other than natural persons. 
 
Garage Liability Insurance Requirement 
Section 8 amends s. 320.27, F.S., which requires the licensure of motor vehicle dealers. The bill 
defines “garage liability insurance” to mean, beginning July 1, 2023, combined single-limit 
liability coverage, including PD and BI liability coverage, of at least $60,000. 
  
Current law only requires at least $25,000 in such coverage and requires $10,000 of PIP 
coverage.  
 
Section 9 amends s. 320.771, F.S., and applies the garage liability insurance requirement of 
s. 320.27, F.S., to recreational vehicle dealers. 
 
Financial Responsibility Requirement for For-Hire Vehicles 
Section 18 amends s. 324.032, F.S., which provides the financial responsibility requirements for 
for-hire passenger vehicles. The bill retains current law requiring the owner or lessee to meet the 
financial responsibility requirement and retains the minimum limits of coverage, which are 
$125,000/$250,000 of BI and $50,000 of PD. The bill amends current law by specifying the 
coverage must be purchased by an insurer that is a member of the Florida Insurance Guaranty 
Association. 
 
Commercial Motor Vehicle Coverage Requirements  
Section 52 amends s. 627.7415, F.S., to increase the minimum levels of combined BI liability 
and PD liability coverage that commercial motor vehicles must have.  BILL: SB 150   	Page 14 
 
  
Beginning July 1, 2023, a commercial motor vehicle that weighs 26,000 pounds or more but less 
than 35,000 pounds must have coverage of no less than $60,000. Current law requires $50,000 of 
coverage. 
 
A commercial motor vehicle that weighs 35,000 pounds or more but less than 44,000 pounds 
must have coverage of no less than $120,000 per occurrence beginning January 1, 2022. Current 
law requires $100,000 of coverage. 
 
The bill retains current law that a commercial motor vehicle weighing 44,000 pounds or more 
must have coverage of no less than $300,000 per occurrence. 
 
Medical Payments Coverage Benefits 
Section 45 creates s. 627.7265, F.S., which requires insurers to offer medical payments coverage 
having limits of $5,000 and $10,000 before issuing a motor vehicle liability insurance policy 
used to meet the financial responsibility requirements of s. 324.031, F.S. Medical payments 
coverage must be offered with no deductible, but insurers may also offer such coverage with a 
deductible of up to $500. Insurers may also offer medical payments coverage with any policy 
limit greater than $5,000.  
 
Medical payments coverage must provide coverage of at least $5,000 for medical expenses 
incurred due to bodily injury, sickness, or disease arising out of the ownership, maintenance, or 
use of a motor vehicle. Medical payments coverage protects the named insured, resident 
relatives, all passengers and operators of the insured vehicle, and all persons struck by the motor 
vehicle while not occupying a self-propelled motor vehicle. 
 
Upon receiving notice of an accident potentially covered by medical payments coverage benefits, 
the insurer must reserve $5,000 for payment to licensed physicians and licensed dentists who 
provide emergency services and care or who provide hospital indigent care. The reserve amount 
may be used only to pay claims from such physicians or dentists until 30 days after the date the 
insurer receives notice of the accident. After the 30-day period, any amount of the reserve for 
which the insurer has not received notice may be used by the insurer to pay other claims. 
 
An insurer providing medical payments coverage benefits may not: 
 Seek a lien on any recovery in tort by judgment, settlement, or otherwise for medical 
payments coverage benefits, whether suit has been filed or settlement has been reached; or 
 Bring a cause of action against a person to whom or for whom medical payments coverage 
benefits were paid, except when benefits are paid by reason of fraud by such person. 
 
The bill authorizes an insurer providing medical payments coverage to include provisions in its 
policy allowing for subrogation
64
 for payment of medical payments coverage benefits if the 
payments resulted from the wrongful act or omission of another who is not also insured under the 
                                                
64
 Subrogation is the principle establishing that when an insurance company pays an insured’s claim of loss caused by a third 
party’s negligence, the insurance company stands in the place of the insured with respect to the insured’s right to sue the 
negligent third party for damages.  BILL: SB 150   	Page 15 
 
policy paying the benefits. However, the bill makes this subrogation right inferior to the rights of 
the injured insured and available only after all of the insured’s damages are recovered and the 
insured is made whole.
65
 
 
Under the bill, if an insured obtains a recovery from a third party of the full amount of the 
damages the insured has sustained, and delivers a release or satisfaction that impairs an insurer’s 
subrogation right, the insured is liable to the insurer for repayment of the medical payments 
benefits, less any expenses of acquiring the recovery, including a prorated share of attorney fees 
and costs. The insured is also required to hold that net recovery in trust to be delivered to the 
medical payments insurer. The bill prohibits an insurer from including any provision in its policy 
allowing for subrogation for any death benefit paid. 
 
Clinic Licensure and Reimbursement under Medical Payments Coverage 
Section 27 amends s. 400.9905, F.S., to provide that an entity is deemed a “clinic” and must be 
licensed in order to receive medical payments coverage reimbursement under s. 627.7265, F.S., 
unless the entity is: 
 Wholly owned by a licensed physician, a licensed dentist, or a licensed chiropractic 
physician; or by the physician, dentist, or chiropractic physician and the spouse, 
parent, child, or sibling of the physician, dentist, or chiropractic physician; 
 A licensed hospital or ambulatory surgical center; 
 An entity that wholly owns or is wholly owned, directly or indirectly, by a licensed 
hospital or hospitals; 
 A clinical facility affiliated with an accredited medical school at which training is 
provided for medical students, residents, or fellows; 
 A clinic certified under federal law to provide outpatient physical therapy and speech 
pathology services; or 
 Owned by a publicly traded corporation which has $250 million or more in total 
annual sales of health care services provided by licensed health care practitioners, if 
one or more of the persons responsible for operations of the entity are licensed health 
care practitioners in this state and are responsible for supervising the business and the 
entity’s compliance with state law. 
 
The above language is currently in s. 627.736(5)(h), F.S., and requires clinic licensure to receive 
reimbursement under PIP. The bill moves the requirement to this section, requires clinic 
licensure to receive reimbursement under medical payments coverage, and retains the 
exemptions from the definition of clinic detailed above. 
 
                                                
65
 This appears to be a codification of the “made whole” doctrine acknowledged by the Florida Supreme Court in Insurance 
Co. of North America v. Lexow, 602 So.2d 528 (Fla. 1992). See also Magsipock v. Larsen, 639 So.2d 1038 (Fla. App. 1994), 
Generally, the principle is that an insurer does not have a common law right to subrogation, or reimbursement, against a third 
party causing the damages sustained by the insured unless the insured has been compensated for all of the insured’s damages 
and been “made whole.” However, the made whole doctrine may be overridden by contractual agreement under current case 
law. See Florida Farm Bureau Ins. Co. v. Martin, 377 So.2d 827 (Fla. 1979) and Blue Cross & Blue Shield of Fla. v. 
Matthews, 498 So.2d 421, 422 (Fla 1986).  BILL: SB 150   	Page 16 
 
This section of the bill also revises the definition of a “clinic” contained in s. 400.9905, F.S., of 
the Health Care Clinic Act, to replace references to PIP coverage and the Florida Motor Vehicle 
No-Fault Law with references to medical payments coverage. 
 
Death Benefit Coverage 
Section 48 creates s. 627.72761, F.S., to require that each insurance policy complying with the 
financial responsibility requirements of s. 324.022, F.S., (requiring $25,000/$50,000 in BI 
coverage and $10,000 in PD coverage) must provide a death benefit of $5,000 for each deceased 
person. The benefit applies to the death of the named insured, resident relatives, passengers in 
the motor vehicle, and others struck by the vehicle while not occupying a self-propelled motor 
vehicle. The bill specifies the persons to whom the insurer may pay such benefits. The benefit is 
unavailable if the deceased died as a result of causing injury or death to himself or herself, or 
death occurred while committing a felony. 
 
Uninsured and Underinsured Motor Vehicle Insurance Coverage 
Section 46 amends s. 627.727, F.S., which governs uninsured motor vehicle insurance coverage. 
Uninsured motorist coverage provides the policyholder with benefits if the at-fault driver does 
not have sufficient bodily injury coverage to make the insured whole for damages related injuries 
caused by the at-fault driver. Under the bill, the legal liability of an insurer providing uninsured 
motorist coverage includes damages in tort for pain, suffering, disability or physical impairment, 
disfigurement, mental anguish, inconvenience, and the loss of past and future capacity for the 
enjoyment of life. Under current law, an uninsured motorist insurer is not liable for such 
damages unless the injury or disease is sufficiently severe under s. 627.737(2)(a)-(d), F.S., of the 
No-Fault Law. 
 
Under the No-Fault Law, a person cannot recover “pain and suffering” damages in tort from the 
at-fault driver’s bodily injury coverage unless the person’s injuries exceed a certain severity 
threshold,
66
 in s. 627.737(2), F.S., commonly referred to as the “verbal threshold.” Personal 
injury protection is considered a no-fault coverage because the injured person trades a limitation 
on the ability to recover pain and suffering damages for the ability to get PIP benefits even if the 
injured person is at fault in the accident. The bill repeals the “verbal threshold” provisions 
contained in the No-Fault Law in s. 627.737, F.S., thus necessitating a revision to s. 627.727(7), 
F.S. 
 
Bad Faith Actions - Civil Remedy in Section 624.155, F.S. 
Section 34 amends subsections (1) and (8) of s. 624.155, F.S. Section 624.155, F.S., authorizes 
any person to bring a civil action against an insurer when damaged by an insurer through 
specified bad faith acts or statutory violations. The bill specifies that the cause of action under 
s. 624.155, F.S., for an insurer’s bad faith failure to settle a claim is not available with regard to 
an action for bad faith failure to settle a third-party claim. Section 624.156, F.S., is created in 
Section 35 of the bill and applies to all bad faith failure to settle a third-party claim actions 
related to a motor vehicle insurance policy. The bill also clarifies the prohibition in subsection 
                                                
66
 The injury or disease must consist in whole or in part of significant and permanent loss of an important bodily function; 
permanent injury within a reasonable degree of medical probability, other than scarring or disfigurement; significant and 
permanent scarring or disfigurement; or death. See s. 627.737(2), F.S.  BILL: SB 150   	Page 17 
 
(8) against a person obtaining judgments under multiple bad faith remedies, whether under 
statute or common law. 
 
Actions Against a Motor Vehicle Insurer for Bad Faith Failure to Settle a Third-Party 
Claim 
Section 35 creates s. 624.156, F.S., the provisions of which apply to all third-party actions for 
bad faith failure to settle against motor vehicle insurers. 
 
Scope - Subsection (1) specifies that s. 624.156, F.S., applies in all actions against any insurer for 
bad faith failure to settle a third-party claim that arise out of a motor vehicle accident. 
Accordingly, it revises the common law cause of action for third-party bad faith failure to settle 
and does not allow bringing such actions outside the provisions of this section. Nor may a third-
party action for bad faith failure to settle be brought under s. 624.155, F.S., pursuant to the bill’s 
revision to s. 624.155(1), F.S. 
 
Defining the Duty of Good Faith – Subsection (2) provides that in handling claims, an insurer 
has a duty to its insured to handle claims in good faith by complying with the best practice 
standards of subsection (4). The bill specifies that an insurer’s negligence does not constitute bad 
faith, but is relevant to whether an insurer acted in bad faith. This is essentially the duty of good 
faith that the Florida Supreme Court established in a 1938 decision,
67
 and since then has 
consistency maintained.
68
 
 
Defining Bad Faith Failure to Settle – Subsection (3) defines “bad faith failure to settle” as an 
insurer’s failure to meet its duty of good faith, as described in subsection (2), which is a 
proximate cause of the insurer not settling a third-party claim when, under all the circumstances, 
it could and should have done so, had it acted fairly and honestly toward its insured and with due 
regard for the insured’s interests.  
 
Best Practice Standards – Subsection (4) sets forth best practice claim handling standards that a 
motor vehicle insurer is subject to upon the earlier of receiving actual notice of an incident or 
loss that could give rise to a covered liability claim and remains subject to the best practices 
standards until the claim is resolved. The bill specifies that notice of the incident or loss not 
made in accordance with the insurance policy, through the insurer’s website, or to the CFO as 
agent of the insurer, is not effective if it prejudices the insurer. The party bringing the action has 
the burden to show the insurer had actual notice. After receipt of the notice, an insurer: 
 Must assign a licensed and appointed insurance adjuster to investigate the claim and 
diligently attempt to resolve questions concerning the existence or extent of the insured’s 
coverage. 
 Based on available information, must evaluate every claim fairly, honestly, and with due 
regard for the insured’s interests, consider the extent of the claimant’s recoverable damages, 
and consider the information in a reasonable and prudent manner. 
                                                
67
 Auto Mut. Indem. Co. v. Shaw, 184 So. 852 (Fla. 1938). 
68
 See Boston Old Colony Ins. v. Gutierrez, 386 So.2d 783 (Fla. 1980), Berges v. Infinity Ins. Co., 896 So.2d 665 at 672-673 
(Fla. 2004), and Harvey v. GEICO General Ins. Co., 259 So.3d 1, at 6-7 (Fla 2018).  BILL: SB 150   	Page 18 
 
 Must request from an insured or claimant additional relevant information the insurer deems 
necessary to evaluate whether to settle a claim. 
 Must conduct all oral and written communications with the insured with the utmost honesty 
and with complete candor. 
 Must make reasonable efforts to explain to persons not represented by counsel matters 
requiring expertise beyond the level normally expected of a layperson with no training in 
insurance or claims handling. 
 Must retain all written communications and note and retain all verbal communications in a 
reasonable manner for a period of not less than 5 years after the later of: 
 The entry of a judgment against the insured in excess of policy limits becomes final; or 
 The conclusion of the extracontractual claim, if any, including any related appeals. 
 Must provide the insured, upon request, with all communications related to the insurer’s 
handling of the claim which are not privileged as to the insured. 
 Must provide, at the insurer’s expense, reasonable accommodations necessary to 
communicate effectively with an insured covered under the Americans with Disabilities Act. 
 In handling third-party claims, must communicate to the insured: 
o The identity of any other person or entity the insurer has reason to believe may be liable; 
o The insurer’s evaluation of the claim; 
o The likelihood and possible extent of an excess judgment; 
o Steps the insured can take to avoid exposure to an excess judgment, including the right to 
secure personal counsel at the insured’s expense; 
o The insured’s duty to cooperate with the insurer, including any specific requests required 
because of a settlement opportunity or by the insurer for the insured’s cooperation under 
subsection (5), the purpose of the required cooperation, and the consequences of refusing 
to cooperate; and 
o Any demands for settlement under subsection (6) or settlement offers. 
 If, after the expiration of the safe harbor periods in subsection (8), the facts available to the 
insurer indicate that the insured’s liability is likely to exceed the policy limits, must initiate 
settlement negotiations by tendering its policy limits to the claimant in exchange for a 
general release of the insured. 
 Must give fair consideration to a settlement offer that is not unreasonable under the facts 
available to the insurer and settle, if possible, when a reasonably prudent person, faced with 
the prospect of paying the total probable exposure of the insured, would do so. The insurer 
shall provide reasonable assistance to the insured to comply with the insured’s obligations to 
cooperate and shall act reasonably to attempt to satisfy any conditions of a claimant’s 
settlement offer. If it is not possible to settle a liability claim within the available policy 
limits, the insurer must act reasonably to attempt to minimize the excess exposure to the 
insured. 
 When multiple claims arise out of a single occurrence, the combined value of all claims 
exceeds the total of all applicable policy limits, and the claimants are unwilling to globally 
settle within the policy limits, thereafter, must attempt to minimize the magnitude of possible 
excess judgments against the insured. The insurer is entitled to great discretion to decide how 
much to offer each respective claimant in its attempt to protect the insured. The insurer may, 
in its effort to minimize the excess liability of the insured, use its discretion to offer the full 
available policy limits to one or more claimants to the exclusion of other claimants and may 
leave the insured exposed to some liability after all the policy limits are paid. An insurer does  BILL: SB 150   	Page 19 
 
not act in bad faith simply because it is unable to settle all claims in a multiple claimant case. 
It is a defense to a bad faith action if the insurer establishes that it used its discretion for the 
benefit of its insureds and complied with the other best practices standards of this subsection. 
 When a loss creates the potential for a third-party claim against more than one insured, must 
attempt to settle the claim on behalf of all insureds against whom a claim may be presented. 
If it is not possible to settle on behalf of all insureds, the insurer may, in consultation with the 
insureds, enter into reasonable settlements of claims against certain insureds to the exclusion 
of other insureds. 
 Must respond to any request for insurance information in compliance with s. 626.9372 or s. 
627.4137, as applicable. 
 Where it appears the insured’s probable exposure is greater than policy limits, must take 
reasonable measures to preserve for a reasonable period of time evidence that is needed for 
the defense of the liability claim. 
 Must comply with s. 627.426, F.S., (providing claims administration standards), if 
applicable. 
 May not commit or perform with such frequency as to indicate a general business practice 
any of the following: 
o Failing to adopt and implement standards for the proper investigation of claims. 
o Misrepresenting pertinent facts or insurance policy provisions relating to coverages at 
issue. 
o Failing to acknowledge and act promptly upon communications with respect to 
claims. 
o Deny claims without conducting reasonable investigations based upon available 
information. 
 
Insured’s Duty to Cooperate – Subsection (5) provides that insureds have a duty to cooperate 
with their insurer in the defense of the claim and in making settlements. Accordingly, the insured 
must take any reasonable action requested by the injured claimant or provided in the policy 
which is necessary to assist the insurer in settling a covered claim, including: 
 Executing affidavits regarding the facts within the insured’s knowledge regarding the 
covered loss; and  
 Providing documents, including a requested financial disclosure. 
 
The bill requires the insured to provide a financial disclosure on a form adopted by the DFS or 
provided by the claimant when such disclosure is requested by the claimant and the disclosure is 
reasonably necessary to settle a covered claim in excess of all applicable policy limits. The 
disclosure must contain a summary of: 
 The insured’s assets at the time of the loss; 
 The insured’s liabilities; 
 For a corporate entity, specified information on its balance sheet; 
 A list all insurance policies that may provide coverage for the claim, stating the name okf 
the insurer and the policy number of each policy; and  
 For natural persons, a statement of whether the insured was acting in the course and 
scope of employment at the time of the incident or loss giving rise to the claim and, if so, 
providing the name and contact information for the insured’s employer. 
  BILL: SB 150   	Page 20 
 
The insurer must notify the insured of the insured’s duty to cooperate under this subsection no 
later than 14 days following actual notice of an incident or a loss that could give rise to a covered 
liability claim. The burden is on the insurer to provide it provided such notice, otherwise a 
presumption arises that the insured met its duty to cooperate under the subsection. 
 
An insurer may terminate the defense as to any insured who unreasonably fails to meet its duties 
to cooperate under this subsection if all of the following occurred: 
 The insurer exercised diligence and met its duty to communicate to the insured the 
insured’s duty to cooperate with the insurer, including any specific requests required, the 
purpose of the required cooperation, and the consequences of refusing to cooperate; 
 The insurer provided reasonable assistance to the insured to meet obligations under this 
subsection; 
 The insurer gave the insured written notice of any failure to cooperate and a reasonable 
opportunity to cure such failure; 
 The insured’s failure to cooperate caused the insurer to be unable to settle the claim; and 
 The insurer unconditionally tenders available coverage policy limits to the claimant or 
claimant’s attorney. 
 
Claimant Communications – Subsection (6) prohibits the trier of fact from attributing the 
insurer’s failure to settle a covered third-party claim to a claimant’s lack of communication if the 
claimant provides specified information about the loss; the legal and factual basis of the claim; a 
reasonably detailed description of any injuries, medical treatment, relevant pre-accident medical 
conditions, and the type and amount of known damages and reasonably anticipated future 
damages; and presents a written settlement demand. The bill specifies that this subsection does 
not reduce the insurer’s duty of good faith, nor does it create a duty of the claimant to the insured 
or insurer. 
 
Conditions Precedent – Subsection (7) establishes two conditions precedent to bringing an action 
against an insurer for bad faith failure to settle a third party claim: 
 The third-party claimant must have obtained a final judgment in excess of the policy, 
unless the insurer expressly waives this requirement or wrongfully breached its duty to 
defend the insured; and 
 The insurer or an agent of the insurer received actual notice of the loss under subsection 
(4). 
 
Safe Harbors – Subsection (8) provides safe harbors for the purpose of allowing the insurer a 
reasonable opportunity to investigate and evaluate the claim. This is done by establishing time 
periods during which an insurer does not commit bad faith by failing to tender policy limits. The 
safe harbors are available to an insurer that meets the best practices standards of subsection (4) 
and provide that: 
 When one claim arises out of a single occurrence, and an insurer initiates settlement 
negotiations by tendering the applicable policy limits in exchange for a general release of 
the insured within 45 days after receiving actual notice of the loss, the failure to tender 
the policy limits sooner does not constitute bad faith. 
 When multiple claims arise out of a single occurrence, the combined value of all claims 
exceeds the total of all applicable policy limits, and an insurer initiates settlement  BILL: SB 150   	Page 21 
 
negotiations by globally tendering the applicable policy limits in exchange for a general 
release of the insured within 45 days after receiving actual notice of the loss, the failure 
to tender policy limits sooner does not constitute bad faith. 
 An insurer is not under any circumstances liable for the failure to accept a settlement 
offer within 45 days after receiving actual notice of the loss if: 
o The settlement offer provides the insurer fewer than 15 days for acceptance; or 
o The settlement offer provides the insurer fewer than 30 days for acceptance where 
the offer contains conditions for acceptance other than the insurer’s disclosure of 
its policy limits. 
 
The bill specifies that the safe harbors do not require that an insurer automatically tender policy 
limits within 45 days in every case. 
 
Burden of Proof – Subsection (9) establishes the burden of proof for bringing an action for bad 
faith failure to settle, an insurer establishing a defense based on the insured’s lack of cooperation, 
and establishing that the insurer qualifies for one of the safe harbors in the statute. Specifically, 
the subsection provides that in any action for bad faith failure to settle, the party bringing the 
action must prove every element of the claim by the greater weight of the evidence, taking into 
account the totality of the circumstances. An insurer that relies upon paragraph (5)(d), regarding 
the insured’s duty to cooperate, as a defense to a claim must prove all elements of that paragraph 
by the greater weight of the evidence. An insurer that relies upon a safe harbor provision of 
subsection (8) must prove the elements of the safe harbor by the greater weight of the evidence. 
 
Damages – Subsection (10) specifies the damages that are available in an action for bad faith 
failure to settle. If the party bringing the action meets its burden of proof, the insurer is liable for 
the amount of the excess judgment, together with court costs and, if the party bringing the bad 
faith claim is the insured or an assignee of the insured, the reasonable attorney fees incurred by 
the party bringing the bad faith claim. Punitive damages may not be awarded. 
 
Agents – Subsection (11) specifies that this section is not intended to expand or diminish any 
cause of action currently available against insurance agents who sell motor vehicle liability 
insurance policies in this state. 
 
Disclosure of Information Related to Liability Insurance Coverage 
Section 43 amends s. 627.4137, F.S., to provide that if an insurer fails to timely comply with the 
requirements of the section, the claimant may file an action to enforce the section and is entitled 
to an award of reasonable attorney fees and costs to be paid by the insurer. Section 627.4137, 
F.S., requires liability insurers to provide, within 30 days after receiving a written request from a 
clamant, a sworn statement setting forth the name of the insurer, name of the insured, limits of 
liability coverage, a statement of any policy or coverage defense the insurer currently believes is 
reasonably available to it, and a copy of the insurance policy. Current law also requires an 
insured or an insured’s insurance agent to disclose to the claimant and all affected insurers, upon 
written request of the claimant or claimant’s attorney, the name and coverage of each known 
insurer. 
  BILL: SB 150   	Page 22 
 
Setoff on Damages as a Result of a Motor Vehicle Crash While Uninsured 
 
Section 62 creates s. 768.852, F.S., to provide that for any award of noneconomic damages, a 
defendant is entitled to a $10,000 setoff if a person suffers injury while operating a motor vehicle 
which was not in compliance with the financial responsibility law for more than 30 days 
immediately preceding the crash. 
 
The setoff on noneconomic damages does not apply if the person who is liable for the injury was 
driving under the influence; acted intentionally, recklessness, or with gross negligence; fled from 
the scene of the crash; or was acting in furtherance of a felony offense or in immediate flight 
from a felony offense. 
 
This section does not apply to wrongful death claims. 
 
Rate Filings 
Section 39 amends s. 627.0651, F.S., providing that initial rate filings for motor vehicle liability 
policies submitted to the OIR on or after July 1, 2023, must reflect the financial responsibility 
requirements of the amended s. 324.022, F.S., and may be approved only through the file and use 
process for making rates for motor vehicle insurance set out in that section of law. 
 
Named Driver Exclusion 
Section 53 amends s. 627.747, F.S., authorizing a private passenger motor vehicle policy to 
exclude an identified individual from bodily injury coverage if an identified individual is 
specifically excluded by name on the policy declarations page or by endorsement, and a 
policyholder consents to such exclusion in writing. Currently, the OIR requires insurers to 
provide exceptions to named driver exclusions up to statutorily required minimum limits for PIP 
coverage, property damage liability coverage, BI liability coverage (if the policy is used to meet 
financial responsibility requirements), and UM coverage in certain circumstances.
69
  
 
An individual excluded by name in an insurance policy would not be covered for bodily injuries 
or death caused by such individual while operating a motor vehicle that is insured under the 
policy, unless the excluded driver has purchased a separate policy that provides motor vehicle 
insurance coverage. 
 
Application of Bill  
Applicability and Construction of Bill and Notice to Policyholders of New Motor Vehicle 
Insurance Requirements 
Section 49 creates s. 627.7278, F.S., applying financial responsibility requirements and optional 
medical payments coverage created by the bill as follows:  
 Effective July 1, 2023: 
o All motor vehicle insurance policies issued or renewed may not include PIP. 
                                                
69
 See Office of Insurance Regulation, Senate Bill 518 Agency Analysis, pg. 2 (Oct. 30, 2017) (on file with the Senate 
Committee on Banking and Insurance.)  BILL: SB 150   	Page 23 
 
o All persons subject to s. 324.022, s. 324.032, s. 627.7415, or s. 627.742, F.S., must 
maintain at least minimum security requirements, which is the security that enables a 
person to respond in damages for liability on account of crashes arising out of the 
ownership, maintenance, or use of a motor vehicle, in the amounts required by s. 
324.022, F.S. 
o Any new or renewal motor vehicle insurance policy delivered or issued in this state must 
provide coverage that complies with minimum security requirements and provides the 
death benefit set forth in s. 627.72761, F.S. 
o An existing motor vehicle insurance policy that provides PIP and property damage 
liability coverage, but does not meet the minimum security requirements 
($25,000/$50,000 BI), is deemed to meet minimum security requirements until the policy 
is renewed, non-renewed or cancelled on or after July 1, 2023, and the provisions of the 
No-Fault law and other related statutes remain in full force and effect for motor vehicle 
accidents covered under a policy issued under the No-Fault law before that date, until the 
policy is renewed, nonrenewed, or canceled on or after July 1, 2023. 
 Insurers must allow each insured who has a policy providing PIP that is effective before July 
1, 2023, and whose policy does not meet minimum security requirements, to eliminate PIP 
coverage and obtain coverage providing minimum security requirements and the death 
benefit under s. 627.72761, F.S., effective on or after July 1, 2023. The insurer is also 
required to offer each insured the optional medical payments coverage required by the bill. 
Insurers may not impose additional fees solely to change coverage, but may charge an 
additional premium that is actuarially indicated. The insurer must refund reductions in 
premium.  
 By April 1, 2023, each motor vehicle insurer shall provide notice that: 
o The Florida Motor Vehicle No-Fault Law is repealed effective July 1, 2023, and that PIP 
coverage is no longer required or available for purchase. 
o Effective July 1, 2023, a person subject to the financial security requirements of 
s. 324.022, F.S., must: 
 Maintain minimum security requirements for BI and PD liability in the amount of 
$25,000 for BI or death of one person in any one crash and, subject to such limits, 
$50,000 for BI or death of two or more persons in any one crash; and $10,000 for PD 
in any one crash, regardless of income or status as a student; and 
 Purchase a death benefit under s. 627.72761 providing coverage in the amount of 
$5,000 per covered deceased individual. 
o BI liability coverage protects the insured, up to the coverage limits, against loss if the 
insured is legally responsible for the death of or bodily injury to others in a motor vehicle 
accident. 
o Effective July 1, 2023, each holder of a motor vehicle liability insurance policy 
purchased as proof of financial responsibility must be offered the optional medical 
payments coverage benefits at limits of $5,000 and $10,000 without a deductible, may be 
offered such coverage at limits greater than $5,000, and may be offered coverage with a 
deductible of up to $500. Medical payments coverage pays covered medical expenses, up 
to the limits, for injuries sustained in a motor vehicle crash by the named insured, 
resident relatives, persons operating the insured motor vehicle, passengers in the insured 
motor vehicle, and persons who are struck by the insured motor vehicle and suffer bodily 
injury while not an occupant of a self-propelled motor vehicle.   BILL: SB 150   	Page 24 
 
o A policyholder may obtain uninsured and underinsured motorist coverage, which 
provides benefits to a policyholder entitled to recover bodily injury damages resulting 
from a motor vehicle accident with an uninsured or underinsured owner or operator of a 
motor vehicle. 
o A policy effective before July 1, 2023, is deemed to meet minimum security requirements 
until it is renewed, non-renewed, or canceled on or after July 1, 2023. 
o A policyholder may change coverages to eliminate PIP protection and obtain coverage 
providing minimum security requirements and the required death benefit. 
o If the policyholder has any questions, he or she should contact the person named at the 
telephone number provided in the notice. 
 
This section is effective upon the act becoming a law. 
 
Application of Suspensions for Failure to Maintain Security 
Section 16 creates s. 324.0222, F.S., requiring all driver license and motor vehicle registration 
suspensions for failure to maintain security as required by law in effect before July 1, 2023, to 
remain in full force and effect after July 1, 2023. A driver may reinstate a suspended driver’s 
license or registration as provided under s. 324.0221, F.S. 
 
Technical and Conforming Changes 
Section 3 amends s. 316.2122, F.S., regarding the operation of low-speed autonomous delivery 
vehicles, to provide a conforming change to a cross-reference. 
 
Section 4 amends s. 316.646, F.S., which requires drivers to maintain and be able to display 
proof of security demonstrating compliance with financial responsibility requirements. The bill 
makes conforming changes necessitated by the bill’s amendment or repeal of other sections of 
law and inserts a cross-reference to the revised s. 324.021(7), F.S., which contains the minimum 
insurance requirements for purposes of proof of financial responsibility beginning July 1, 2023. 
 
Section 5 amends s. 318.18(2), F.S., regarding nonmoving traffic violations, to remove a 
reference to PIP and conform cross references. 
 
Section 6 amends s. 320.02, F.S., which contains the requirements to register a motor vehicle. 
The bill amends the section to require proof of motor vehicle insurance that meets the minimum 
limits of BI and PD liability, remove references to PIP, and make other conforming changes. 
 
Section 7 amends s. 320.0609, F.S., to eliminate a reference to PIP in a provision specifying that 
transferring a license plate from a vehicle disposed of to a newly acquired vehicle does not 
constitute a new registration. 
 
Section 10 amends s. 322.251, F.S., regarding notice of cancellation, suspension, or revocation 
of a driver’s license to repeal references to the No-Fault Law. 
 
Section 11 amends s. 322.34, F.S., regarding driving on a suspended, revoked, canceled, or 
disqualified driver’s license, to delete a reference to the No-Fault Law. 
  BILL: SB 150   	Page 25 
 
Section 12 amends s. 324.011, F.S., which provides the purpose of ch. 324, F.S., to specify that 
under the chapter all owners or operators of a motor vehicle required to be registered in this state 
must establish, maintain and show proof of financial responsibility. Currently, financial 
responsibility requirements only apply after an operator is involved in a crash or convicted of 
certain traffic offenses. 
 
Section 15 amends s. 324.0221, F.S., which requires insurers to report motor vehicle insurance 
cancellations to the DHSMV, to remove references to PIP and replace the reference to PD 
coverage with a reference to liability coverage, and conform cross references. 
 
Section 17 corrects cross references in s. 324.023, F.S., which requires drivers who plead guilty 
or nolo contendere to a charge of driving under the influence to meet additional liability 
insurance requirements. 
 
Section 20 amends s. 324.051, F.S., regarding crash reports, to refer to motor vehicle liability 
policies rather than automobile liability policies. 
 
Section 21 amends s. 324.071, F.S., to provide stylistic changes to provisions governing the 
reinstatement of a suspended license. 
 
Section 22 amends s. 324.091, F.S., which requires owners and operators involved in a crash or 
conviction case to furnish evidence of liability insurance, by deleting references to an automobile 
liability policy while retaining references to a motor vehicle liability policy. 
 
Section 26 amends s. 324.251, F.S., to revise the short title of ch. 324, F.S., to the “Financial 
Responsibility Law of 2022” and state it will be effective at 12:01 a.m., on July 1, 2023. 
Currently the chapter is the “Financial Responsibility Law of 1955.” 
 
Sections 28 and 29 amend s. 400.991, F.S., and s. 400.9935, F.S., respectively, of the Health 
Care Clinic Act to remove references to PIP and the No-Fault Law and insert references to 
medical payments coverage. 
 
Section 30 revises the definition of a “third party benefit” in s. 409.901, F.S., for purposes of 
Medicaid to refer to medical payments coverage rather than PIP coverage. 
 
Section 31 amends s. 409.910(11), F.S., to specify that the Agency for Health Care 
Administration may recoup the total amount of medical assistance provided by Medicaid from 
motor vehicle insurance coverage benefits provided to a Medicaid beneficiary. Current law refers 
to PIP. 
 
Section 32 amends s. 456.057, F.S., regarding patient records, to correct a cross-reference. 
 
Section 33 amends s. 456.072, F.S., to allow the Department of Health to discipline licensees for 
submitting claims for medical payments coverage reimbursement when treatment is not rendered 
or when treatment is intentionally upcoded. The department currently has such disciplinary 
authority with regard to false billing under PIP coverage. The bill relocates from the repealed  BILL: SB 150   	Page 26 
 
s. 627.732, F.S., the existing definition of “upcoded,” and replaces references to PIP with 
references to medical payments coverage. 
 
Section 36 amends s. 626.9541(1)(i) and (o), F.S., regarding unfair insurance trade practices 
related to motor vehicle insurance. The bill deletes the unfair trade practice in paragraph (i) for 
failing to pay claims within statutory time periods required under the No-Fault Law to conform 
to the repeal of those time frames by the bill. The section makes a technical amendment to 
paragraph (o) to reference BI liability coverage, PD liability coverage, and medical payments 
coverage, rather than PIP, in the prohibitions against the unfair insurance trade practice of 
increasing premium or cancelling a motor vehicle insurance policy solely because the insured 
was involved in a motor vehicle accident without having information the insured was 
substantially at fault. 
 
Section 37 amends s. 626.989, F.S., to revise the “fraudulent insurance acts” detailed in the 
section to refer to medical payments coverage, rather than the No-Fault Law. 
 
Section 38 amends s. 627.06501, F.S., regarding insurance discounts for completing a driver 
improvement course, to delete a reference to PIP and insert a reference to medical payments 
coverage. 
 
Sections 40 and 41 amend s. 627.0652, F.S., and s. 627.0653, F.S., respectively, relating to 
insurance discounts for motor vehicle coverage, by replacing references to PIP with references to 
medical payments coverage. 
 
Section 42 amends s. 627.4132, F.S., regarding the general prohibition against stacking of motor 
vehicle coverages, to refer to BI and PD instead of PIP or other coverage. 
 
Section 44 amends s. 627.7263, F.S., which generally makes the rental and leasing driver’s 
insurance primary, to delete references to PIP and insert references to medical payments 
coverage. 
 
Section 50 amends s. 627.728, F.S., which governs cancellations of motor vehicle insurance 
policies, to delete a reference to PIP in the definition of “policy.” 
 
Section 51 amends s. 627.7295, F.S., to revise definitions relating to motor vehicle insurance 
contracts by deleting references to PIP and inserting references to BI liability coverage, death 
benefit coverage, and make other conforming and editorial changes. 
 
Section 54 amends s. 627.748, F.S., relating to insurance requirements for transportation 
network companies, to remove references to PIP required under the repealed No-Fault law and 
inserts cross-references to the revised financial responsibility requirements applied to for-hire 
passenger transportation vehicles in Section 17 of the bill. 
 
Section 55 amends s. 627.7483, F.S., relating to peer-to-peer car sharing, to remove a reference 
to PIP and correct cross references. 
  BILL: SB 150   	Page 27 
 
Section 56 amends s. 627.749, F.S., relating to insurance requirements for autonomous vehicles, 
to delete a reference to PIP in those insurance requirements and add a reference to death benefit 
coverage. 
 
Section 57 amends s. 627.8405, F.S., regarding prohibited acts of premium finance companies, 
to replace a reference to a PIP/PD only policy with a reference to a policy that only provides 
BI/PD. 
 
Section 58 amends s. 627.915, F.S., which requires private passenger automobile insurers to 
report information annually to the office, to remove references to PIP and add a reference to 
death benefit coverage. 
 
Section 59 amends s. 628.909, F.S., which applies certain provisions of the Insurance Code to 
captive insurance companies, to delete references to the No-Fault Law. 
 
Section 60 amends s. 705.184, F.S., which governs derelict or abandoned motor vehicles on the 
premises of public-use airports, to delete references to s. 627.736, F.S., which is repealed by the 
bill. 
 
Section 61 amends s. 713.78, F.S., regarding liens for recovering, towing, or storing vehicles and 
vessels, to delete references to s. 627.736, F.S., which is repealed by the bill. 
 
Section 63 amends s. 817.234, F.S., regarding false and fraudulent insurance claims, to delete 
references to PIP and replace them with references to medical payments coverage. 
 
Appropriation 
Section 64 appropriates for the 2022-2023 fiscal year $83,651 in nonrecurring funds from the 
Insurance Regulatory Trust Fund to the Office of Insurance Regulation for the purpose of 
implementing the act. 
 
Effective Date 
Section 63 provides that except as otherwise expressly provided in the act and this section, 
which take effect upon this act becoming a law, the act is effective July 1, 2023. 
IV. Constitutional Issues: 
A. Municipality/County Mandates Restrictions: 
None. 
B. Public Records/Open Meetings Issues: 
None.  BILL: SB 150   	Page 28 
 
C. Trust Funds Restrictions: 
None. 
D. State Tax or Fee Increases: 
None. 
E. Other Constitutional Issues: 
None. 
V. Fiscal Impact Statement: 
A. Tax/Fee Issues: 
Bodily injury coverage is not a required coverage under Florida law unless a person is 
involved in certain accidents causing bodily injury, convicted of certain offenses, or is 
otherwise required to maintain BI liability coverage in statute. Failure to maintain BI 
coverage, when required, can result in the suspension of a license or registration. The 
reinstatement fee under s. 324.071, F.S., for such suspension under current law is $15. 
CS/CS/SB 54 retains this reinstatement fee for a license suspension based upon a crash 
report under s. 324.051(2), F.S.; a registration suspension under s. 324.072, F.S., based 
on a license suspension pursuant to s. 322.26, F.S., or s. 322.27, F.S.; suspension of the 
operating privileges of a nonresident driver under s. 324.081, F.S.; or suspension of 
license and registration under s. 324.121, F.S., for failure to satisfy a judgment. 
 
The bill retains the current reinstatement fees under s. 324.0221, F.S., for a suspended 
license or registration for failure to maintain required insurance based on a report by an 
insurer. The reinstatement fee for such suspensions under s. 324.0221, F.S., is $150 for a 
first reinstatement, while second and subsequent reinstatements within 3 years of the first 
reinstatement require fees of $250 and $500, respectively. 
B. Private Sector Impact: 
The fiscal impact to policyholders, health insurers, health care providers, and injured 
claimants is indeterminate. The Office of Insurance Regulation has commissioned 
Pinnacle Actuarial Services to perform two studies of the impact of repealing PIP and 
mandating BI, the first in 2016 and the second in 2021. Though the two studies each 
analyzed the effects of repealing PIP and mandating BI at limits of $25,000/$50,000, 
each provided different estimates of the impact of repealing PIP and mandating BI. 
 
The 2016 report, Florida Office of Insurance Regulation: Review of Personal Injury 
Protection Legislation, provided, among other information, actuarial estimates of the 
savings expected from repealing the No-Fault Law.
70
 The report concludes, based only on 
repeal of the No-Fault Law with financial responsibility limits of $25,000/$50,000, that a 
                                                
70
 Office of Insurance Regulation, Review of Personal Injury Protection Legislation, (Sept. 13, 2016), Appendix 3, p. 1. 
Available at http://www.floir.com/siteDocuments/FLOIRReviewPIP20160913.pdf (last accessed January 31, 2022).  BILL: SB 150   	Page 29 
 
5.6 percent savings would be realized in the statewide average premium charge.
71
 The 
estimated average premium when including an optional $5,000 medical payments 
coverage benefit was projected to increase by 0.3 percent.
72
 
 
The 2016 PIP Study estimated that health insurers would cover approximately $469.7 
million of current PIP loss if No-Fault were repealed.
73
 Health care providers would 
cover approximately $32.8 million of current PIP losses.
74
 Injured claimants would cover 
approximately $82.9 million of current PIP losses.
75
 In an addendum to the study, 
Pinnacle evaluated the effect on premiums of enacting legislation
76
 that provides that a 
motor vehicle insurer is not liable for a bad faith failure to settle when it offers to pay the 
claimant the lesser of the amount demanded or policy limits with 45 days of receiving 
written notice of the loss. Pinnacle estimated such a provision would reduce BI premiums 
by 0.9 percent.
77
 
 
The 2021 report, Florida Office of Insurance Regulation: The Impact of Repealing 
Personal Injury Protection Coverage in Florida
78
, provided an actuarial analysis of SB 
54 (2021), which proposed repealing PIP, mandating bodily injury coverage of at least 
$25,000/$50,000, required an offer of medical payments coverage that the insured could 
opt-out of, and provided insurers safe harbors from bad faith actions. The 2021 report 
concludes, based only on repeal of the No-Fault Law with financial responsibility limits 
of $25,000/$50,000, that a the statewide average premium
79
 would increase by 1.5 
percent.
80
 Adding $5,000 in medical payments coverage yielded an estimated 8.6 percent 
premium increase in the statewide average premium.
81
 The 2021 report projects that the 
average statewide premium for insureds that purchase the minimum statutory coverage 
under the No-Fault Law of $10,000 of PIP and $10,000 of PD, would increase 48.3 
percent if mandatory PIP were replaced by mandatory BI at limits of $25,000/$50,000.
82
 
It should be noted that these projections were based on SB 54 (2021), which 
automatically included medical payments coverage unless the policyholder declines the 
coverage, an “opt-out” system. SB 150 instead requires the insurer to offer medical 
payments coverage but does not include it unless the policyholder affirmatively 
purchases the coverage, an “opt-in” system. Making medical payments coverage opt-in, 
rather than opt-out will result in fewer policyholders purchasing the coverage, thus 
reducing the average premium that is paid for motor vehicle insurance. 
                                                
71
 That is the average premium savings for a driver purchasing BI, UM, PD, Comprehensive, and Collision coverages. 
72
 See Office of Insurance Regulation fn. 70. 
73
 See Office of Insurance Regulation fn. 70 at pg. 68. 
74
 See id. 
75
 See id. 
76
 Senate Bill 1088 (2015). 
77
 Office of Insurance Regulation, Review of Personal Injury Protection Legislation – Addendum: Impact of Florida Third-
Party Bad Faith Reform, pg. 6 (Sept. 27, 2016). Available at 
https://www.floir.com/siteDocuments/FloridaBadFaithAddendumFinal.pdf (last accessed January 31, 2022). 
78
 Office of Insurance Regulation, The Impact of Repealing Personal Injury Protection Coverage in Florida, (June 14, 2021). 
Available at https://www.floir.com/siteDocuments/FloridaOIRPIPRepealImpactFinalReport06142021.pdf (last accessed 
January 31, 2022). 
79
 That is the average premium savings for a driver purchasing BI, UM, PD, Comprehensive, and Collision coverages. 
80
 See Office of Insurance Regulation fn. 78 at pg. 43. 
81
 See id. 
82
 See Office of Insurance Regulation, fn. 78 at pg. 111.   BILL: SB 150   	Page 30 
 
 
The 2021 PIP Study estimated that health insurers would cover approximately $304 
million of current PIP loss if No-Fault were repealed.
83
 Health care providers would 
cover approximately $13 million of current PIP losses.
84
 Injured claimants would cover 
approximately $45.5 million of current PIP losses.
85
 Unlike the 2016 report, the 2021 
report does not estimate savings related to providing insurers a safe harbor from bad faith 
actions.  
C. Government Sector Impact: 
The bill appropriates $83,651 in FY 2022-23 nonrecurring funds from the Insurance 
Regulatory Trust Fund to the Office of Insurance Regulation to implement the act. 
 
The Florida Office of Insurance Regulation has not provided an estimate of the fiscal 
impact of this bill. However, a fiscal impact provided in 2021 for SB 150 (2021) 
estimated that implementation of this bill would have required salaries and benefits at a 
recurring cost of $228,602 annually, commencing in FY 2021-22. They also estimated a 
need for nonrecurring computer programming costs of $20,000 in FY 2021-22. 
 
The fiscal impact to state and local governments is otherwise indeterminate. 
VI. Technical Deficiencies: 
None. 
VII. Related Issues: 
None. 
VIII. Statutes Affected: 
This bill substantially amends the following sections of the Florida Statutes:  316.2122, 316.646, 
318.18, 320.02, 320.0609, 320.27, 320.771, 322.251, 322.34, 324.011, 324.021, 324.022, 
324.0221, 324.0222, 324.023, 324.031, 324.032, 324.051, 324.071, 324.091, 324.151, 324.161, 
324.171, 324.251, 400.9905, 400.991, 400.9935, 409.901, 409.910, 456.057, 456.072, 624.155, 
624.156, 626.9541, 626.989, 627.06501, 627.0651, 627.0652, 627.0653, 627.4132, 627.4137, 
627.7263, 627.7265, 627.727, 627.7275, 627.72761, 627.7278, 627.728, 627.7295, 627.7415, 
627.747, 627.748, 627.7483, 627.749, 627.8405, 627.915, 628.909, 705.184, 713.78, 768.852, 
and 817.234 
 
This bill creates the following sections of the Florida Statutes: 324.0222, 624.156, 627.7265, 
627.72761, 627.7278, and 768.852 
 
                                                
83
 See Office of Insurance Regulation fn. 78 at pg. 33. 
84
 See id. 
85
 See id.  BILL: SB 150   	Page 31 
 
This bill repeals the following sections of the Florida Statutes:  627.730, 627.731, 627.7311, 
627.732, 627.733, 627.734, 627.736, 627.737, 627.739, 627.7401, 627.7403, 627.7405, and 
627.7407 
IX. Additional Information: 
A. Committee Substitute – Statement of Changes: 
(Summarizing differences between the Committee Substitute and the prior version of the bill.) 
None. 
B. Amendments: 
None. 
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.