“It will take years for the impacts of fraud and legal system abuse to be wrung out of the system and for policyholders to experience premium benefits. Job 1 is to ‘stop the bleeding’ as insurers fail, leave the state, or stop writing critical personal lines coverages like auto and homeowners.”
The institute is referring to Florida’s Senate Bill 2A, which handed in state Legislature in December 2022 and was later signed into legislation by Governor Ron DeSantis.
Citing info from the Florida Office of Insurance Regulation, Triple-I stated that Florida accounts for practically 80% of America’s householders’ insurance coverage lawsuits, however solely 9% of all US householders’ insurance coverage claims are filed within the state. This, the institute famous, is why Florida’s dwelling insurers have cumulatively incurred internet underwriting losses of greater than $1 billion in each 2020 and 2021.
In 2022 alone, six insurers working in Florida’s dwelling insurance coverage market grew to become bancrupt, whereas others left the state of restricted their insurance policies bought.
“Legislation approved during Florida’s late 2022 special session eliminated “one-way attorney fees” for property insurance coverage claims. Before the reform, state legislation required insurers to pay the charges of policyholders who efficiently sued over claims, whereas shielding policyholders from paying insurers’ lawyer charges when the policyholders lose,” the temporary famous.
Triple-I’s temporary additionally famous how the laws eradicated the follow of project of advantages (AOBs) – agreements the place property house owners signal over their claims to contractors, who then work with insurers.
“AOBs are a standard practice in insurance, but in Florida this consumer-friendly convenience has long served as a magnet for fraud,” the temporary stated. “The state’s legal environment – including some of the most generous attorney-fee mechanisms in the country – has encouraged vendors and their attorneys to solicit unwarranted AOBs from tens of thousands of Floridians, conduct unnecessary or unnecessarily expensive work, then file lawsuits against insurers that deny or dispute the claims.”
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