The Florida legislature has been called back for a special session starting Dec. 12 regarding the most recent insurance crisis. Lawyers, contractors, public adjusters and policyholders called me to ask me what was going to happen and what was on the table.
Here are the various topics that have been raised or told to me by various lobbyists and politicians:
- Assignment of benefits (AOB)
- One-way attorney fees
- Solicitation of contractors
- Public solicitation of adjuster
- Bad Faith Lawsuits
Any legislation passed will undoubtedly have an impact on policyholders. The number of insurance companies declaring insolvency and the huge spike in insurance rates have led to calls for politicians in Florida to do something about the crisis. If they could only legislate to keep hurricanes away, the problems would disappear. California and Colorado face the same decrease in available insurance due to a massive increase in wildfires in recent years.
At the same time, many Florida policyholders with large insurance claims from Hurricanes Ian and Nicole are learning what to expect while waiting for fair treatment from their insurers. Slow, low payment for far less than the total amount allegedly owed is the new normal of treatment by many carriers who hire outside disaster experts to settle claims. A number of independent adjusters who have resigned tell me horror stories of how their field estimates are being wrongly reduced by adjusters and company mandates.
So what do insurance companies want to avoid being held accountable for their lousy treatment of policyholders and making their profits a certainty? Eliminate AOBs, establish loser pays attorney’s fees or no attorney’s fees, place more caps on public adjuster fees, establish new regulations for independent restoration contractors while reducing liability for Managed repair contractors operating under insurer guidelines, make Florida a safety net for low public supports reinsurance rates and eliminate bad faith liability. This is the agenda of the insurance lobby.
Over the past few weeks, I have worked with a number of policyholder attorneys and our firm’s lobbyists. Lawyer Merlin Law Group javier delgado made suggestions regarding the wording of the legislation in conjunction with the Florida Justice Association. FAPIA lobbyist Paul Handerhan and others worked behind the scenes. But what may happen is anyone’s guess.
The laws passed over the past three years have been slow to impact the insurance market. A recent law regarding building ordinances will significantly increase litigation as some insurers abuse the new law.
What’s going to happen ? I expect we’ll hear more about the behind-the-scenes deals later this week. You can always lower rates by changing the laws so that insurers never have to pay losses quickly and in full and prevent them from being sued when they do. Stay tuned.
Thought of the day
The world will not be saved by legislation.
—William Howard Taft