The Truth About Florida PIP Insurance Lawsuits

Reproduced below is a letter published in the September/October 2010 issue of The Florida Bar Journal. It was written by my friend, collegue, superb trial lawyer, and advocate for the underprivileged, Cris Boyar. The letter exposes the dirty propaganda disseminated by the insurance industry regarding PIP (Personal Injury Protection) lawsuits. A must read.

Elimination of PIP Multipliers Response

I read the slanted article, “Putting the Lid Back on Pandora’s ‘Jar’: A Clarion Call for the Elimination of Contingency Risk Multipliers in Florida PIP Litigation,” by insurance defense lawyers Douglas Stein and Donald Blackwell in the July/August issue. While it is long on words, it is clearly short on reality. The article fails to mention that insurance companies drive up legal fees by causing expensive and protracted litigation. In the real world, insurance companies not only routinely and unreasonably deny valid claims, but when sued, the insurers file frivolous defenses, deny admissions that should be admitted, propound significant discovery, object to basic discovery, force countless hearings, schedule numerous unnecessary depositions of collateral witnesses, and demand jury trials that can last for days. If the insurer loses, it demands attorneys’ fees hearings and files appeals. Then, after all of the litigation that it caused, the insurer complains the legal fees awarded against it are too high and do not bear a relationship to the amount in controversy. The hypocrisy is obvious to those who sue insurance companies for denying valid claims.

If an insurer wants to limit its exposure to legal fees and costs, it can simply pay valid claims timely. It could also pay the claim in response to the statutorily mandated presuit demand letter, which allows 30 additional days to pay without risk of paying attorneys’ fees. If it is sued for not paying a claim, it can instruct its defense lawyers to agree to a bench trial, admit allegations and admissions, and agree to narrow the issues. If the insurer believes it will lose the case, the insurer, at any time, can simply confess judgment to stop the clock. Alternatively, the insurer can file an offer of judgment. If the insurer then prevails in the litigation, the insurer will be reimbursed its attorneys’ fees and costs by the insured or the medical provider.

Rather than fall prey to insurance industry propaganda, the public should realize the insurance industry has embarked on a strategic campaign designed specifically to poison the pool of potential jurors and bar its insureds’ access to courts, while at the same time filling its coffers with premiums Florida citizens are legislatively mandated to pay.

It must be pointed out that multipliers are very rarely awarded in PIP cases. Most lawyers who handle PIP claims reject a significant number of cases for various reasons. The unfortunate result is that many insureds and medical providers have no recourse when the insurers wrongly and routinely deny valid PIP claims. This is exactly what some of the billion dollar insurance companies hope to accomplish. Accepting premiums and denying claims is a very profitable business model.

The multiplier is the only tool available to encourage competent counsel to accept the most difficult cases that virtually every other lawyer would reject. The applicability of the multiplier should be preserved by the legislature. The trial judges, observing the conduct of counsel for both sides, should be trusted to make the correct decision based on existing Florida law.

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Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.