The Flag Legislature is anticipated to deal with legal professional charges in property insurance coverage instances — a change supported by Florida realtors — throughout subsequent week’s particular session.
TALLAHASSEE, Fla. – Count on modifications to legal professional charges as a step in subsequent week’s particular legislative session to deal with Florida’s troubled property insurance coverage system, Home Commerce Committee Chairman Bob Rommel mentioned Wednesday.
Florida Realtors® has centered on legal professional charges as a solution to deal with the state’s property insurance coverage challenges. Members beforehand accredited initiatives to:
- Assist laws to abolish one-sided legal professional charges and to reign in different judicial abuses in property insurance coverage claims disputes, with the purpose of creating Florida enticing to insurance coverage and reinsurance capital
- Assist the upkeep, implementation and/or refinement of shopper protections within the State of Florida associated to property insurance coverage and property insurance coverage claims to make sure they obtain their supposed goal(s)
Home and Senate leaders on Tuesday launched a abstract of the matters for the session, however Rommel, R-Naples, mentioned talks are nonetheless underway on the small print of the payments that can go earlier than lawmakers. The listening to begins on Monday.
Rommel, talking at an annual Florida Chamber of Commerce insurance coverage summit in Orlando, mentioned one difficulty that shall be addressed is the influence of what are referred to as “unilateral legal professional charges.” Insurers have lengthy sought modifications as a result of they could possibly be pressured to pay plaintiffs’ charges in insurance coverage claims lawsuits.
“Whenever you’re watching tv … there are extra commercials for a lawyer speaking about not fattening you whenever you’re injured, however placing cash in your pocket,” Rommel mentioned. “And one way or the other in Florida, we have gotten to this space the place it is not about making individuals complete and hurting them. It is about making you wealthy or having a lawyer.”
Rommel mentioned the modifications in the course of the session will purpose to assist shoppers, shield an business on “life help” and appeal to funding capital to Florida’s insurance coverage market.
“We all know we’ve got to do some aggressive issues that some individuals within the insurance coverage business will not like, some shoppers will not like, some lawmakers will not like. However you continue to must do it,” mentioned Rommel.
However Amy Boggs, chair of the Florida Bar Affiliation’s Property Insurance coverage Part, criticized the deal with limiting lawsuits, saying such strikes would harm shoppers.
“The issue is not the litigation — it is the scapegoat,” Boggs mentioned in a press release Tuesday. “Behind each lawsuit is a house or enterprise proprietor who has been underpaid or wrongly denied protection.”
Senate President Kathleen Passidomo, R-Naples, and Home Speaker Paul Renner, R-Palm Coast, issued an official proclamation of the session Tuesday that listed various insurance coverage points that could possibly be thought of. These points embrace making an attempt to include litigation prices; growing the provision of essential reinsurance; to restrict a long-controversial apply referred to as project of advantages (AOB); and strengthen the monetary stability of Residents Property Insurance coverage Corp.
Florida’s “Final Insurer.”
Residents was created as an insurer of final resort. With corporations shedding lots of of hundreds of insurance policies to scale back monetary dangers — and 6 insurers in chapter since February — Residents has seen its coverage numbers rise from 542,739 in December 2020 to 1.13 million as of Friday.
“I do know that if I have been trying to put my capital to work, I most likely would not wish to come to Florida within the present scenario,” Rommel mentioned. “That’s the reason we’ve got seen the rise of residents. You understand, residents, we’ve got principally backed the fares. They don’t seem to be actuarially sound.”
Throughout a particular assembly of the Residents Board of Governors on Wednesday, Residents President and CEO Barry Gilway additionally mentioned {that a} main problem is attracting funding capital to the market. On the identical time, insurers are seeing giant will increase within the prices of reinsurance, the backup protection that performs a essential position in Florida.
Whereas Gilway helps laws to curb litigation, he mentioned such modifications will not instantly clear up the business’s issues. Consequently, he mentioned short-term state help could also be wanted to assist with points resembling reinsurance. Throughout a particular session in Could, lawmakers accredited spending $2 billion on reinsurance.
Throughout a name with reporters Tuesday, Home Democrats argued that lawmakers ought to deal with fee hikes, push for a nationwide catastrophic threat pool, guarantee owners are higher educated about their insurance policies and cut back dependence on residents.
Rep. Hillary Cassel, a Dania Seashore legal professional specializing in property insurance coverage legislation, mentioned the federal government and insurance coverage corporations must be held extra accountable for his or her actions. She pointed to the state Workplace of Insurance coverage Regulation.
“We have to overview the information that OIR (Workplace of Insurance coverage Regulation) receives on a commission-type foundation, the place stakeholders have a possibility to overview the huge quantity of knowledge and report again to the legislature, moderately than they solely get factual OIR displays,” Cassel mentioned.
Florida Chief Monetary Officer Jimmy Patronis needs lawmakers to contemplate a statewide prosecutor centered on insurance coverage fraud. “It is time to focus a bit extra and take a preventative measure,” Patronis mentioned Tuesday on the Chamber occasion in Florida.
Patronis additionally referred to as on lawmakers to cease the longstanding apply referred to as profit earmarking.
Profit assignments, which embrace underwriting insurance policies for insurance coverage claims in opposition to contractors, have been extremely controversial lately, particularly involving issues like water injury claims.
Lawmakers have taken a number of steps to attempt to restrict the project of advantages, arguing, partly, that the apply has led to pricey litigation.
© 2022 Florida Information Service. All rights reserved. Information Service Government Editor Jim Saunders contributed to this report.