1.3 Insurance & Financial Responsibility

Insurance & Financial Responsibility

Driving a vehicle carries significant financial risk. To protect the public, Florida enforces strict insurance mandates. Every driver must prove they have the financial means to cover damages or injuries they might cause. Florida handles this through two primary laws: the No-Fault Law and the Financial Responsibility Law.

The Florida No-Fault Law

Florida is one of several states that operate under a "no-fault" auto insurance system. Under the No-Fault Law, if you are involved in a crash, your own insurance company pays for your medical bills and certain other losses, regardless of who caused the collision.

To comply with the No-Fault Law, the owner of a motor vehicle with four or more wheels that has been in the state for at least 90 days of the preceding 365 days must carry minimum coverage.

The required minimum coverages are:

1. $10,000 in Personal Injury Protection (PIP): PIP covers you, your children, passengers in your vehicle who do not have their own PIP, and you as a pedestrian or bicyclist if injured in a crash. It covers 80% of necessary medical expenses and 60% of lost wages, up to the $10,000 limit, regardless of fault.
2. $10,000 in Property Damage Liability (PDL): Unlike PIP, which pays for your own injuries, PDL pays for the damage you cause to someone else's property in a crash. This includes their vehicle, fences, buildings, or street signs.

You must maintain this continuous coverage as long as the vehicle has a valid Florida license plate. If you cancel your insurance, you must first surrender your license plate and registration to the FLHSMV. Failing to maintain continuous PIP and PDL coverage will result in the suspension of your driver's license and vehicle registration, and you will have to pay a reinstatement fee of up to $500.

The Financial Responsibility Law

While the No-Fault Law focuses on basic PIP and PDL, the Financial Responsibility Law acts as an additional safety net. It specifically requires drivers who have a history of crashes or severe violations to carry Bodily Injury Liability (BIL) coverage.

Bodily Injury Liability (BIL) pays for serious and permanent injuries or death to others when you cause a crash. It also pays for your legal defense if you are sued.

The Financial Responsibility Law requires you to have BIL coverage if any of the following apply:

• You cause an accident resulting in bodily injury to others.
• You cause an accident resulting in property damage and your vehicle was deemed inoperable.
• You have prior convictions for certain traffic offenses.
• Your license was suspended for accumulating too many points.

If you trigger the Financial Responsibility Law (for example, by causing an injury crash without having BIL at the time), you will be required to purchase BIL insurance and maintain it for three years. The minimum limits required are typically $10,000 for injuries to one person and $20,000 for injuries to two or more people.

FR-44: High-Risk Insurance for DUI Convictions

Florida treats Driving Under the Influence (DUI) extremely seriously. A DUI conviction automatically triggers the state's most stringent financial responsibility requirement, known as the FR-44 filing.

If you are convicted of a DUI, your insurance company must file an FR-44 form with the state, proving that you carry significantly elevated levels of insurance. The minimum coverage limits required for an FR-44 filing are:

• $100,000 for Bodily Injury Liability (BIL) for injuries to one person.
• $300,000 for Bodily Injury Liability (BIL) for injuries to two or more people.
• $50,000 for Property Damage Liability (PDL).

You are required to maintain this high-risk FR-44 coverage for a continuous period of three years. Because of the severity of a DUI, insurance premiums under an FR-44 requirement are exceptionally high.

Proving You Have Insurance

Law enforcement officers will ask for proof of insurance during traffic stops and crash investigations. You can provide proof of insurance using a traditional paper insurance card provided by your insurer or by displaying a digital insurance card on your smartphone or electronic device.

Remember, driving without valid insurance is illegal and puts you at tremendous financial risk. If you are in a crash and do not have the required insurance, you will be held personally liable for the damages, which can lead to wage garnishment and loss of assets.