In Florida Personal Injury Protection (PIP or No Fault) pays 80 percent of all necessary and reasonable medical expenses incurred as a result of a covered injury, regardless of who caused the accident.

According to the FL Department of Financial Services (FLDFS), the insurance regulator for this state, the company that covers the at fault party is not required to make payments under the Bodily Injury coverage, unless the injury/injuries cross the $10,000 PIP "no fault" threshold. However, a company may volunteer to pay the 20 percent before the claim reaches the $10,000 limit.

The tort liability (no fault) threshold which applies to Personal Injury Protection is crossed if an injury from an automobile accident results in any of the following (per Florida Statute 627.737):

• significant and permanent loss of important body function,
• permanent injury,
• significant and permanent scarring, or
• disfigurement, or death.

Uninsured/Underinsured Motorist (UM) Coverage in Florida pays for "accidental" bodily injury (BI), sickness, or disease, including death, when an insured sustains such injury as the result of an automobile accident and the legally obligated party does not have Bodily Injury Coverage, or does not have sufficient limits to satisfy the injury claim. This includes both economic (actual medical bills and other out of pocket expenses) as well as non-economic (pain and suffering) damages.

So the order for coverages would pay in is:

1. The elderly woman’s own PIP coverage;
2. The at-fault party's Bodily Injury Liability;
3. The elderly woman’s Uninsured/Underinsured Motorist Bodily Injury Coverage.

They would pay in this order because:
Florida is a no-fault state and regardless of fault, PIP pays first. After PIP is exhausted, the liable party (at fault driver) is responsible. If they were uninsured or underinsured then the elderly woman’s UM would pay for damages.

With no deductible on PIP, the payouts for medical would be:

1. PIP - $8,000 for medical because PIP will cover 80% of all accident-related expenses. This would be paid as long as none of the new PIP rules applies and as long as no part of the $10,000 limit was paid out for disability.
2. BI - $10,000 – This is the limit of the at-fault driver. The at-fault driver is subject to lawsuit for $92,000 of damages caused by them.
3. UM - $82,000 – Because the driver elected to purchase optional UM, it would pay up to the $100,000 limit for bodily injury.

Changes to Florida PIP coverage could change the available payout (effective 1/1/08):

• New restrictions on the types of clinics that can bill PIP:
• A new fee schedule capping what most health care providers can charge to 200% of the Medicare reimbursement rates.
• A new provision allocates $5,000 for doctors who administer emergency and hospital care. This requires insurers to reserve $5,000 of benefits for 30 days for physicians providing emergency services or care or inpatient hospital care.
• New uniform PIP claim documentation requirements for PIP claims. Mandates the consolidation of perfected claims from one health care provider relating to the claim.

If any of these applied, the $8,000 PIP amount may be limited or allocated differently.

Since the allocation of payments of the various auto insurance coverages can be confusing if you are in a situation where you need to figure out what payments you or others can receive you can speak with your car insurance agent or contact the state's insurance regulator for consumer advice and help. Good luck on your test. :)