Application of PIP benefits for out-of-state automotive insurance policies in Florida
written by: Kevin Grim, Jr., Esq.
Well, ladies and gentlemen, it’s that time of year again here in Florida; that special time when our brethren to the North make their annual migration south for the winter in search of sun, beach, and early-bird specials. Yes, “snowbird season” is upon us. With this influx of out-of-state drivers, comes a varied amount of out-of-state automotive policies.
This post will touch upon some of the important issues when adjusting a claim involving a Florida motor vehicle accident with an out-of-state policy.
Located within most automotive insurance policies, you will find a choice-of-law provision. For instance, the policy may provide:
Without regard to choice of law rules, the law of the state of New Jersey will control in the event of any disagreement as to the interpretation and application of any provision in this policy;…
Based on this policy language, an accident that occurs in Florida but involves a New Jersey policy would still be subject to New Jersey law for purposes of interpretation and application. Moreover, courts have consistently upheld these choice-of-law provisions, or lex loci contractus. In the seminal case State Farm Mut. Auto. Ins. Co. v. Margaret Roach, et al., 945 So. 2d 1160 (Fla. 2006), the Supreme Court of Florida found, in relevant part:
In determining which state’s law applies to contracts, the Supreme Court of Florida has long adhered to the rule of lex loci contractus. That rule, as applied to insurance contracts, provides that the law of the jurisdiction where a contract was executed governs the rights and liabilities of the parties in determining an issue of insurance coverage.
The benefit of invoking lexi loci may not be immediately apparent. A cursory glance at some of these out-of-state No-Fault PIP policy limits would lead one to think that medical providers would be chomping at the bit to invoke these provisions themselves. For instance, New Yorkers have a minimum PIP policy limit of $50,000.00. New Jerseyites have a minimum or basic PIP limit of $15,000.00, but a standard limit of a $250,000.00. In fact, of the tri-states, only Pennsylvania’s $5,000.00 PIP/FPB limit is lower than the $10,000.00 minimum limit found in Florida. Yet, attached to these out-of-state limits come some serious conditions and limitations. For example, the standard PIP policy in New Jersey is subject to a $105 per day cap for chiropractic services
Possibly the most lethal defense available to a Florida adjuster or attorney litigating a claim involving a New Jersey policy is the one delineated by the case Lanoue v. Rizk, which found that for contract cases, lex loci contractus will determine the applicable statute of limitations. Lanoue v. Rizk, 987 So. 2d 724, 727(Fla. 3d DCA 2008).
In comparison to Florida’s rather generous 5-year Statute of Limitation (SOL) New York’s SOL on PIP matters is 3 years from the last payment or accident. For Pennsylvania, the SOL is 3 years after the insurance company refused payment. In New Jersey, the SOL on PIP matters is 2 years after the injured person suffers a loss or incurs an expense caused by the accident, or not later than 4 years after the accident, whichever is earlier.
When dealing with an out-of-state policy it is critical to learn and understand the relative policy language and law controlling the application of insurance benefits. Stay vigilant for out-of-state insureds, an irregular PIP limit, or an unfamiliar form policy number. Also, use this opportunity to make sure the claimant actually lives where they say they live and there is no rate-jumping/material misrepresentation going on. If circumstances exist, then pursue invoking the choice-of-law provision. Engaging in these preliminary steps could ultimately avail you to some powerful defenses.
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