May 21, 2022
  • May 21, 2022

Florida lawmakers consider property insurance changes amid skyrocketing rates

By on April 28, 2021 0

TALLAHASSEE – In a rush to stop soaring Florida home insurance rates, state lawmakers are set to pass a bill that would reduce the time it takes to file a claim and allow the property insurance of citizens to raise rates above 10%.

The Florida House voted 74-43 Wednesday on an invoice this would reduce the time to file a property insurance claim from three to two years and prevent contractors and adjusters from soliciting homeowners to file a claim.

As homeowners’ insurance rates have risen, state lawmakers, including Republicans in the House and Senate, are divided over how best to address it.

The Senate has already voted its own version of Senate Bill 76, which also cuts the time to file a claim by one year and allows Citizens Property Insurance, the state-run insurance company of Florida, to increase its rates. The Senate bill also prohibits citizens from lowering its rates.

Lawmakers have until Friday, when the legislative session is expected to end, to resolve any disputes between bills.

Lawmakers on Wednesday pleaded for action.

“There’s nobody in the room here who doesn’t think there’s a problem with insurance rates rising 25 to 30 percent a year,” Representative Bob Rommel, R- said Wednesday. Naples. “If we do nothing, they will double in two years.

Even without a hurricane making landfall in the Sunshine State last year, Florida’s property insurance market posted one of its worst financial performances of 2020.

Fifty-six Florida insurers reported combined underwriting losses of $ 1.57 billion, according to financial data obtained by the Tampa Bay Times, spending more on claims and expenses than they earned in premiums. The figure marks the fifth consecutive year of industry losses in the state and is more than two and a half times what those companies lost in 2019.

Related: The Florida property insurance market is struggling. There is no miracle solution.

As a result, Floridians statewide have seen their rates rise recently, often in double digits. Last year, the Florida Office of Insurance Regulation approved 105 home insurance rate increases, and some companies have proposed more than one. More than half of the increases were over 10 percent.

However, there is much debate as to why these rates have increased.

Insurers blame soaring reinsurance rates – the insurance insurance companies buy to manage their risks – as well as the claims that accumulate from past hurricanes and an increase in lawsuits.

What lawmakers are proposing this year focuses on litigation. The bill the House approved on Wednesday would require homeowners to file 10 days’ notice before taking legal action.

The bill also prohibits contractors from soliciting homeowners to file a roofing claim – a practice that insurers say has resulted in a dramatic increase in roofing claims in recent years.

“They’re knocking on doors, ‘Let me get on your roof, I’ll give you $ 500, I’ll give you a free roof, and you won’t even have to pay your deductible,’” Rommel said of Contractors. “These schemers convince homeowners to file bad claims.”

Public adjusters, hired by owners to independently assess claims, would also be prohibited from offering incentives such as gift cards to owners.

Related: Florida Insurance Regulator Reviews Property Insurers

The bill would also require insurers to report more data to the Office of Insurance Regulation. And that would allow the regulatory office to have greater oversight of the management affiliates of insurers – secondary companies that can charge insurers up to $ 25 per policy, as well as a fee for providing their services to the insurer. .

These affiliates can siphon millions of dollars from insurers. When several companies in the Poe Insurance Group, a Tampa-based group of companies founded by former Tampa Mayor Bill Poe, became insolvent following the 2004 and 2005 hurricane seasons, the state took legal action. .

The state claimed that while companies struggled to meet their commitments to policyholders, their executives and shareholders continued to receive millions of dollars in distributions.

Democratic lawmakers said on Wednesday that there were other ways to give homeowners relief, such as giving homeowners money directly to harden their homes.

“This legislation is the problem, not the solution, although we need it,” said Representative Yvonne Hayes Hinson, D-Gainesville.

Homeowners who are still waiting for insurers to pay their Hurricane Michael claims have urged lawmakers to take a stronger stance against the companies. Last week, several traveled to Tallahassee to say they had no choice but to hire a lawyer to sue their insurer.

“I’ve never filed an insurance claim in my entire life, and they turned me down,” said Melaine Hardwick, whose Mexico Beach home was wiped out. “They left me with no choice but to hire a lawyer.”

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Cover of the Legislative Assembly of the Tampa Bay Times in Florida

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