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Florida Governor Ron DeSantis has vetoed a measure intended to replace auto insurance personal injury protection (PIP) coverage with bodily injury coverage limits and requiring insurers to offer medical payments coverage.

In a letter time-stamped at 9:12 pm last night, DeSantis wrote that he was vetoing the bill (SB54) because it may have “unintended consequences.”

The bill received widespread support from Florida lawmakers but faced scrutiny from critics including insurers arguing that the repeal would raise rates and lead to a higher number of uninsured drivers.

DeSantis seemed to have listened to the critics.

“While the PIP system has flaws and Florida law regarding bad faith is deficient, CS/CS/SB 54 does not adequately address the current issues facing Florida drivers and may have unintended consequences that would negatively impact both the market and consumers,” DeSantis wrote.

SB 54 would have repealed the state’s no-fault PIP system and instead required mandatory bodily injury coverage of at least $25,000 for all Florida drivers. The passed version of the bill also provides the option of a $5,000 medical payment coverage (MedPay) death benefit.

Bill sponsor Danny Burgess, a Republican, pointed to a 2016 Office of Insurance Regulation study that showed rates would decrease if PIP was repealed.

Opponents of the repeal said it would have the opposite effect.

Sponsored by Florida Surplus Lines Service Office (FSLSO)
Insurer trade group American Property Casualty Insurance Association argued the cost of an average auto insurance policy could increase by as much as 23%, or $344. Drivers with low coverage levels could see an increase as high as $805 annually.

“Moving forward, we hope any proposals to reform or eliminate Florida’s no-fault auto insurance system will reduce consumer costs, combat rampant lawsuit abuse by implementing meaningful bad faith reforms, and prevent or minimize fraud,” APCIA said in a statement applauding the veto.