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buying property abroad
News and Information Article
MALVERN, Pa., March 3 // -- Florida personal injury protection
(PIP) claim costs (claimed economic losses and actual claim payments)
increased at double-digit rates between 2002 and 2005, far outpacing the rate
of inflation, according to a new Insurance Research Council (IRC) study. The
average total claimed PIP economic loss, including medical expenses, wage
loss, and other out-of-pocket expenses, increased 18 percent over the three-
year period, reaching $9,769 in 2005. Average claim payments increased 24
percent, from $4,606 to $5,712. During the same period, the general rate of
inflation (all-item Consumer Price Index) was 9 percent, and the rate of
inflation for medical services was 13 percent.
The recently released study, Florida Auto Injury Insurance Claim
Environment, also documents that, as claim costs increased, the seriousness of
injuries in Florida PIP claims declined. Seventy-one percent of PIP claimants
had no disability resulting from their injuries in 2005, compared with 67
percent in 2002 and 66 percent in 1997. The percentage of PIP claimants with
fewer than 10 days of restricted activity also grew, from 81 percent in 1997
and 86 percent in 2002, to 87 percent in 2005. Almost three-quarters (73
percent) of PIP claimants reported a sprain or strain as their most serious
injury in 2005, compared with 68 percent in 2002 and 61 percent in 1997.
The utilization and cost of chiropractic services in Florida soared
between 2002 and 2005, according to the study. Whereas 33 percent of all PIP
claims included charges from chiropractors in 2002, 44 percent of the 2005
claims included chiropractic charges. The average total amount charged per
claimant by chiropractors increased 35 percent over the three-year period,
from $4,837 to $6,510.
PIP claimants in Florida also hired attorneys more frequently in 2005 than
three years earlier. The study found that 45 percent of claimants in 2005
hired attorneys, compared with 34 percent in 2002.
"Rapidly increasing costs, combined with less serious injuries, explosive
growth in the utilization of chiropractic services, and extensive attorney
involvement are red flags indicating that the Florida no-fault system is in
trouble," said Elizabeth A. Sprinkel, senior vice president of the IRC.
The IRC study examines detailed claim information from more than 4,000
claims closed with payment during 2005. Ten insurers, representing more than
60 percent of the 2005 private passenger auto insurance market in Florida,
participated in the study. For more detailed information on the studys
methodology and findings, contact Elizabeth Sprinkel by phone at (610) 644-
2212, ext. 7568; by fax at (610) 640-5388; or by e-mail at irc@cpcuiia.org; or
visit the IRCs Web site at http://www.ircweb.org . Copies of the study are
available for $100 each in the U.S. ($115 elsewhere) postpaid from the
Insurance Research Council, 718 Providence Rd., Malvern, Pa. 19355-0725.
Phone: (610) 644-2212, ext. 7569. Fax: (610) 640-5388.
NOTE TO EDITORS: The Insurance Research Council is a division of the
American Institute for CPCU and the Insurance Institute of America. The
Institutes are independent, not-for-profit organizations dedicated to
providing educational programs, professional certification, and research for
the property-casualty insurance business. The IRC provides timely and reliable
research to all parties involved in public policy issues affecting insurance
companies and their customers. The IRC does not lobby or advocate legislative
positions. It is supported by leading property-casualty organizations.
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