What is a collateral source rule?

A collateral source rule is a legal rule in Florida that requires an insurance company to pay the full amount of an insurance claim even if the person filing the claim received compensation from a “collateral source”, such as a private insurer or a government-funded program. In other words, the insurance company still has to pay the full amount despite the claimant receiving other compensation. This is done to ensure that the full benefit is provided to the claimant and not taken away by the insurance company. The collateral source rule applies to many types of insurance claims, such as auto, health, home, and life insurance. In the case of auto insurance, it means that the insurance company has to cover the full amount of a claim even though the claimant received compensation from a different auto insurance policy or from a government-funded program. The same applies to health insurance, where the insurance company has to pay the full amount of the claim even though the person received compensation from a health insurance policy or from Medicaid. The purpose of the collateral source rule is to ensure that the claimant is adequately compensated for their losses, regardless of where the compensation comes from. It is an important legal tool to ensure that insurance companies are held accountable and are not able to deny claims or reduce benefits based on the amount of payment from other sources.

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What is a collateral source rule?

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