Florida Legislature passes property insurance overhaul

TALLAHASSEE — The Florida Legislature handed sweeping adjustments to the state’s property insurance coverage legal guidelines on Wednesday.

Now it’s time for Florida owners to attend — and hope their premiums go down.

This week’s laws, handed throughout a hasty particular session in Tallahassee, is supposed to stabilize the state’s imploding property insurance coverage market.

It gives a $1 billion taxpayer-funded help program for struggling insurers and sharply limits the incentives to sue these corporations.

One factor it received’t do — not less than any time quickly — is decrease charges for Floridians, who’re paying the very best owners insurance coverage premiums within the nation.

And for these with state-backed Residents Property Insurance coverage insurance policies, they are going to possible find yourself paying greater than they do immediately.

“What this invoice signifies to me is hope,” stated Rep. Tom Leek, R-Ormond Seashore. “Hope and a plan to guarantee that we because the State of Florida are doing the whole lot we presumably can to restore a damaged property insurance coverage market.”

“Hope don’t pay your invoice,” Rep. Patricia Williams, D-Pompano Seashore, stated.

Every chamber handed the laws throughout a 48-hour blitz lower than per week after the invoice was launched. Public testimony in some committees was restricted to a minute. On Wednesday, Republican leaders restricted Democrats’ whole debate to 80 minutes.

The top outcome was by no means doubtful. On Tuesday, the Senate accepted it with a 27-13 vote, largely alongside occasion traces. The Home on Wednesday voted 84-33.

Limiting lawsuits

One of many few issues lawmakers agreed on this week is that the owners insurance coverage market is in a disaster that has been constructing for years. Six corporations have gone out of enterprise this yr.

Republicans’ answer is essentially a giveaway to the insurance coverage trade, which has complained for years that it’s been sued too typically. The state does have a disproportionate variety of lawsuits for the variety of claims; In 2019, the state accounted for 16% of the nation’s owners claims, however 76% of the nation’s litigated owners claims, state regulators say.

Why there are such a lot of lawsuits is hotly in dispute, with Republicans this week blaming fraudulent trial legal professionals and Democrats blaming insurance coverage corporations holding up claims.

State regulators received’t have any detailed knowledge from insurers on litigated claims till March on the earliest, Insurance coverage Commissioner David Altmaier instructed lawmakers this week.

The laws handed Wednesday would largely get rid of the necessities that property insurers pay the legal professional charges of policyholders who win lawsuits over claims. It might finish the apply of “project of advantages,” by which policyholders signal over their advantages to contractors, who search fee from insurers.

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And it will permit insurers to supply insurance policies that require the policyholder to interact in obligatory binding arbitration in lieu of a lawsuit. The coverage must be cheaper than one with out binding arbitration.

Insurance coverage corporations have additionally cited the excessive price of reinsurance — insurance coverage that insurers purchase to pay out claims throughout storms — for his or her struggles. In response, Lawmakers created a $1 billion taxpayer-funded program to supply reinsurance.

The laws has no ensures that corporations decrease owners’ charges, and Republicans had no analyses demonstrating that decrease charges could be the outcome.

“This invoice doesn’t repair costs,” stated Leek, a chief authorized officer for an insurance coverage brokerage.

As a substitute, the invoice is supposed to stabilize the market, Leek stated. In time, charges may come down, Republicans stated.

That was not sufficient, Democrats stated.

“We’ve heard loads about stabilizing markets,” stated Home Minority Chief Rep. Fentrice Driskell, D-Tampa. “What about stabilizing checkbooks?”

Options rejected

Republicans known as the laws a balanced proposal, pointing to the truth that they have been shortening the timelines for insurance coverage corporations to pay or deny a declare (60 days as a substitute of 90) and to conduct a bodily inspection (30 days as a substitute of 45), among other time frames.

However the laws additionally reduces the time a policyholder can file a declare, from two years to at least one.

Policyholders with Residents must purchase flood insurance coverage, some as quickly as April. And they’d not have the ability to renew their protection in the event that they obtain coverage gives from non-public insurers which might be inside 20% of the price of the Residents premiums.

The laws was crafted behind the scenes, after weeks of conferences between Gov. Ron DeSantis’ workplace and GOP leaders within the Home and Senate.

It went untouched throughout this week’s session, with Republicans rejecting each modification Democrats proposed. A type of was filed Wednesday by Rep. Anna Eskamani.

Her proposal would have prohibited bonuses or awards to property insurance coverage executives at corporations that increase charges. Citing reporting within the Occasions/Herald that insurer CEOs made thousands and thousands in years with out storms, she stated insurers shouldn’t be getting bonuses after they increase charges.

“There may be nothing extra disgusting than profiteering off the backs of Floridians,” Rep. Anna Eskamani, D-Orlando, stated.

This can be a creating story. Examine again for updates.