State Farm Sues 1-800-ASK-GARY…How It Affects Your Car Insurance

car insurance coverage in florida

I’m pretty sure that everyone in the state of Florida is familiar with those commercials where Roz proclaims “Don’t be scared and confused!”
I’m also pretty confident that we’re all aware there is a questionable nature associated with these lawyer referral services. And while these commercials are annoying, most assume they are harmless.

Well, not really. Ever wonder why even though you haven’t gotten into an accident or made any claims to your car insurance company, your car insurance rates keep rising? Well, here’s why. The Insurance Information Institute estimates that Florida is one of the top 5 states in the nation for fake auto insurance claims. This year, false car insurance claims could cost Floridians as much as $1 billion dollars and it’s believed to be one of the biggest cost drivers for escalating auto insurance rates. Florida is an easy target for fake auto insurance claims because we’re one of the ten states that have Personal Injury Protection, or PIP. PIP is ‘no-fault’ auto insurance coverage that provides up to $10,000 in medical expenses and lost wages and is required by all owners of motor vehicles registered in Florida. According to the Florida Office of Insurance Regulation, in the last few years, while the numbers of drivers and auto accidents have remained relatively constant, the amount of PIP claims and PIP payments have increased drastically.

But, there may be a light at the end of the tunnel. A federal lawsuit has been filed against the founder of 1800-Ask-Gary accusing the company of a “massive fraud scheme” and taking advantage of no-fault insurance benefits. The outcomes of this lawsuit could have huge implications for insurance in Florida… and savings for you. If the insurance company is successful in this endeavor, this might deter other accident referral services from exploiting PIP. A decrease in the amount of false claims would make insuring drivers in Florida less risky and less expensive. This means that insurance companies would be able to offer cheaper car insurance rates to consumers, without sacrificing coverage, limits, or service. Basically, as fraud decreases, so will your insurance rates.