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Why is Florida auto insurance so expensive?

That’s a good question and it’s one we receive regularly from consumers who contact us looking for a more competitive rate for their Florida auto insurance policy.  Unfortunately, one of the reasons Florida auto insurance policies are expensive is that Florida tops the nation in fraudulent auto insurance claims, according to the National Insurance Crime Bureau.  The NICB determined that Florida had more than 3,000 staged accidents in 2009.  That’s double the number in New York and California.  These staged accidents are criminal acts that will cost the Florida auto insurance policyholder an estimated $658 million in higher premiums this year alone. 

According to Fox Business, “The Insurance Research Council estimates that one claim in 10 made under Florida’s no-fault insurance system is outright fraud, and one in three is exaggerated or overbilled. About 27% of personal injury protection claims involve a visit to a pain clinic, the IRC says, while one-third of them involve an MRI, and 43% include chiropractic care.”

While there are many factors that contribute to the cost of auto insurance premiums, the one cost that could be controlled and reduced concerns fraudulent auto insurance claims and their associated healthcare costs.  However, until that happens Floridians will continue to pay high premiums.

DISCLAIMER: Because of the generality of this update, and based on particular situations, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice, financial advice and/or the advice of a licensed insurance or certified human resource professional.

© Connelly, Carlisle, Fields & Nichols 2012

Jennifer Rabon

Author: Jennifer Rabon

As an Advisor at Connelly, Carlisle, Fields & Nichols (CCF&N), Jennifer provides a comprehensive overview of the client’s insurance needs and generates proposals for their individual lines of business. Prior to joining CCF&N, Jennifer worked as the Director of Operations for Global Background Checks. Previous to that, she was the Assistant Store Manager at Baker’s Shoes. Jennifer has been awarded with CCF&N’s 2010 Top Personal Sales Producer Award. She also holds certifications as a professional in Insurance Account Management and Certified Professional Service Representative. Jennifer is involved in numerous industry and community organizations, such as the Clearwater Regional and Clearwater Beach Chambers of Commerce, the American Marketing Association and the FAIA’s Young Agent’s Council. Jennifer attended St. Petersburg College.
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