CANNARELLA v. ALLSTATE INDEMNITY COMPANY (2002)

Alicia Cannarella appeals an adverse summary judgment on a putative class action lawsuit brought by insureds seeking late payment interest on medical expenses.   We affirm because statutory interest on overdue personal injury protection (PIP) benefits accrues thirty days after an insurance company receives a written notice of claim.

Ms. Cannarella filed suit on behalf of herself and others who purchased automobile insurance and were allegedly not paid interest on PIP benefits by Allstate Indemnity Company during a specified period.   Allstate filed a motion to dismiss or, in the alternative, a motion for summary judgment.   Following a hearing, the trial court granted summary judgment for Allstate, finding that the interest it was required to pay on overdue PIP benefits was to be calculated from the thirty-first day.

Section 627.736(4), Florida Statutes (2000), provides that PIP benefits such as medical bills are due and payable when the loss “accrues” and upon the insurer's receipt of reasonable proof of loss.   Insurers are provided with a thirty-day period in order to verify whether the loss is payable or whether it is barred because of a policy exclusion and to determine whether the services provided and the amount of the bill were reasonable and necessary.   See § 627.736(4).

The issue presented in this case has been addressed by the Third District.   In United Automobile Insurance Co. v. Stat Technologies, Inc., 787 So.2d 920, 922 (Fla. 3d DCA 2001), the court determined that “the legislature intended that interest on overdue PIP payments does not commence until the loss accrues, which is 30 days after the insurance company receives notice of a fact of covered loss.”   We agree with the holding of the Third District.   Additional support for this determination is contained in United Automobile Insurance Co. v. Rodriguez, 808 So.2d 82, (Fla. 2001).   Although not directly addressing the issue of when overdue PIP benefits begin to accrue interest under section 627.736(4)(c), the supreme court did state that payment is overdue if not paid within thirty days and that all overdue payments shall bear interest.

Accordingly, we affirm the trial court's determination that interest begins to accrue when the PIP payments are overdue-on the thirty-first day.

BLUE, Chief Judge.

GREEN and CASANUEVA, JJ., Concur.