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Consumer Protection Coalition statement on property insurance reform bill heard by Senate panel

The Consumer Protection Coalition issued the following statement today on the pro-consumer provisions in Senate Bill 76, which was approved by the Florida Senate Banking and Insurance Committee:

“Senate Bill 76 addresses head-on two problems that have led to a worsening property insurance market for consumers – runaway attorney fees that are fueling Florida’s insurance litigation explosion and some existing coverage and claims-filing policies that are serving as an invitation for fraud and abuse by bad actors preying on the state’s residents.

“The bill will help to eliminate excessive attorney fee awards by only allowing lawyers to petition courts to have their fees multiplied in cases with rare or extraordinary circumstances. Currently, attorneys use the fee multiplier even in routine cases, which can double or triple their fees. The bill also models attorney fee reforms recently passed and proven successful in Texas that require that fees reflect the value of any settlement obtained for the policyholder.

“Additionally, the bill would standardize claims-filing deadlines and require that Florida property insurance policyholders file claims within two years of a loss. This is similar to other states that face elevated windstorm or hail risk. Currently, Florida allows policyholders up to three years to file a hurricane claim and five years for any other claim, which has led to gaming of the system, fraud and abuse that drives up costs and hurts consumers.

“The bill also would address abuse currently plaguing the roofing industry by allowing insurers to pay the actual cash value (i.e. the depreciated value) of roofs that are 10 years old or older, versus the replacement cost (i.e. new retail cost). Florida’s Insurance Commissioner recently told legislators that questionable advertising solicitations by roofing contractors – such as “one broken tile or shingle equals one new roof” – were targeting unsuspecting consumers and leading to a surge in questionable roof damage claims and lawsuits.

“The Consumer Protection Coalition applauds the Senate Banking and Insurance Committee, and Committee Chairman and bill sponsor Senator Jim Boyd, for the thoughtful consumer protections contained in Senate Bill 76. Florida’s consumers should have full control over their insurance policies and the value of those policies, and have their legitimate claims covered in a timely and professional fashion. But legislators must address the runaway attorney fees, fraud and abuse that are driving up insurance costs and hurting access to coverage for many Floridians.”

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