In Flaxman v. Government Employees Ins. Co., 993 So.2d 597 (Fla. 4th DCA 2008), the insured had PIP with GEICO which paid statutorily mandated benefits of 80% of medical expenses as well as 60% of lost wages up to a total of $10,000. The insured also had available under the same policy “Additional” PIP or APIP which increased the amount of PIP benefits up to 100% of medical expenses and 85% of lost wages.
The insured incurred $17,000 of medical expenses as a direct result of a covered automobile accident. GEICO argued that the most that they were required to pay under the policy, including both PIP and APIP, was $10,000. The insured argued that GEICO was required to pay $10,000 under the PIP portion of the policy, and $2,500 under the APIP portion of the policy. Suit ensued, and the issue eventually worked its way up to the 4th DCA.
The 4th DCA ruled in favor of GEICO, and held that the APIP did not increase the aggregate benefits available under the policy. The aggregate available benefits under the policy remained $10,000. The APIP merely increased the percentage which GEICO had to pay for covered expenses, i.e., instead of paying 80% of covered medical expenses, GEICO had to pay 100% of covered medical expenses up to $10,000.
In reaching its decision, the court relied heavily on the “limit of liability” section of the policy which limited GEICO’s total exposure to an aggregate of $10,000. From the decision it does not appear that GEICO’s “Additional” PIP carried a separate limit of liability. In other words, the APIP did not have a limit of say $2,000, or $5,000. Instead, the APIP merely paid the additional percentages for covered expenses. The outcome would likely be different if the Additional PIP had a separately stated limit amount.