Florida legislature begins special session on insurance
8 min readThe Florida Legislature on Monday began a special session focused on fixing the state’s turbulent property insurance market, considering sweeping legislation to create a $2 billion reinsurance fund and place new rules around attorney fees and coverage denials as lawmakers attempt to stabilize a market plagued by rising rates and insurer insolvencies.The Senate Committee on Appropriations began debating the proposals and are expected to approve them later Monday. The bills would then move to the full Senate.The latest: WPBF 25 News coverage on PoliticsThrough hours of committee debate, the Republican sponsor of the proposals acknowledged that they would not immediately drop rates for homeowners but maintained the legislative package is necessary for the long-term health of the state’s market.“It’s very serious. some carriers are on life support, some are about to pull the plug, others are in critical condition. And without reform will go to life support and or pull the plug. so I don’t know that we could be in any worse a position as Floridians than we are,” said Sen. Jim Boyd. “Floridians are frustrated with the rising cost of property insurance, and I say rightfully so. And that’s really our hope as we head into this week is trying to bring some stability to the marketplace and hopefully some relief already in the pocket,” said Rep. John Snyder.Video below: ‘It’s very, very difficult’: Rental crisis solutions in South FloridaOne big reason for the skyrocketing policy prices– claims for new roofs from all over the state have flooded insurers — and some of those claims were fraudulent.”We’ve seen issues with roofers and claims adjusters going out and telling people how they can get their roofs replaced when they maybe don’t need to be replaced. We’ve seen issues with attorneys who are charged via bringing lawsuits for bad faith claims. We’ve seen insurance companies raising rates, maybe not necessarily in a justified manner. And we’ve seen reinsurance rates going up, extraordinary exorbitantly,” said Sen. Lori Berman.Lawmakers are looking at two bills taking aim at those problems and more — one being the insurance companies having to pay huge costs to the companies that insure them –which drives up your costs.The proposals would create the $2 billion Reinsurance to Assist Policyholders program for insurers to purchase insurance to help insulate themselves from risk. In order for an insurer to access the fund, it would have to reduce policyholder’s rates — but that won’t happen right away. “Now, I can tell you unequivocally that they should definitely pay their policies now, because there will not be an immediate impact. We’re hearing still that it should take anywhere from 18 to 24 months before people see a reduction in their insurance rates,” said Senator Bobby Powell.Lawmakers say it’s taken years to get to this critical tipping point”But I’m happy that we’re here talking about it now because we know it’s a crisis in the state and we know that people are suffering and we’ve got to do something so that people can stay in their homes and be able to afford their homeowners insurance,” said Berman.The special session comes as Florida’s second extracurricular meeting of the legislature in recent months, following the failure of the GOP-controlled statehouse to pass insurance proposals earlier this year during its regular meeting period. There is also increasing urgency for lawmakers to address problems in the state’s market ahead of the looming hurricane season, which in previous years has brought devastating storms to Florida, such as the Category 5 Hurricane Michael in 2018.’People are fighting for apartments’: South Florida housing demand driving up rentThe bills would forbid insurers from automatically denying coverage because of a roof’s age if the roof is less than 15 years old. Homeowners with roofs 15 years or older would be allowed to get an inspection of their condition before insurers deny them coverage, under the bill. If an inspection shows that a roof has at least five years of life remaining, insurers can’t refuse to issue a policy only based on the roof’s age under the proposed legislation.Another measure would provide grants worth up to $10,000 each to retrofit homes so they are less vulnerable to hurricane damage. To qualify, properties would have to have insured values of $500,000 or less, be homesteaded, constructed before 2008 and located in areas where wind speeds from storms can exceed 140 mph (225 kph). Homeowners would get $2 from the state for every $1 they invested in mitigation efforts.The legislation also seeks to limit various attorney fees in insurance-related cases, which insurers blame for much of the rate increases for policyholders. Supporters of the legislative package have frequently noted that Florida accounted for 9% of all insurance claims filed nationally but nearly 80% of all the property insurance lawsuits. Palm Beach County mayor: No rent cap to be imposed by countyThe bills would allow for more state oversight so regulators can spot trends, analyze reasons and try to prevent the future failure of insurers. The insurance industry has had two years of underwriting losses exceeding $1 billion each year, according to the office of Florida Gov. Ron DeSantis, a Republican. Several insurance companies have either gone insolvent, required midterm cancelations, are in liquidation or have stopped writing new business since 2021, the governor said in his proclamation calling lawmakers back to the Capitol.The special session is set to run from Monday to Friday. This article contains information from The Associated Press.
The Florida Legislature on Monday began a special session focused on fixing the state’s turbulent property insurance market, considering sweeping legislation to create a $2 billion reinsurance fund and place new rules around attorney fees and coverage denials as lawmakers attempt to stabilize a market plagued by rising rates and insurer insolvencies.
The Senate Committee on Appropriations began debating the proposals and are expected to approve them later Monday. The bills would then move to the full Senate.
The latest: WPBF 25 News coverage on Politics
Through hours of committee debate, the Republican sponsor of the proposals acknowledged that they would not immediately drop rates for homeowners but maintained the legislative package is necessary for the long-term health of the state’s market.
“It’s very serious. some carriers are on life support, some are about to pull the plug, others are in critical condition. And without reform will go to life support and or pull the plug. so I don’t know that we could be in any worse a position as Floridians than we are,” said Sen. Jim Boyd.
“Floridians are frustrated with the rising cost of property insurance, and I say rightfully so. And that’s really our hope as we head into this week is trying to bring some stability to the marketplace and hopefully some relief already in the pocket,” said Rep. John Snyder.
Video below: ‘It’s very, very difficult’: Rental crisis solutions in South Florida
One big reason for the skyrocketing policy prices– claims for new roofs from all over the state have flooded insurers — and some of those claims were fraudulent.
“We’ve seen issues with roofers and claims adjusters going out and telling people how they can get their roofs replaced when they maybe don’t need to be replaced. We’ve seen issues with attorneys who are charged via bringing lawsuits for bad faith claims. We’ve seen insurance companies raising rates, maybe not necessarily in a justified manner. And we’ve seen reinsurance rates going up, extraordinary exorbitantly,” said Sen. Lori Berman.
Lawmakers are looking at two bills taking aim at those problems and more — one being the insurance companies having to pay huge costs to the companies that insure them –which drives up your costs.
The proposals would create the $2 billion Reinsurance to Assist Policyholders program for insurers to purchase insurance to help insulate themselves from risk. In order for an insurer to access the fund, it would have to reduce policyholder’s rates — but that won’t happen right away.
“Now, I can tell you unequivocally that they should definitely pay their policies now, because there will not be an immediate impact. We’re hearing still that it should take anywhere from 18 to 24 months before people see a reduction in their insurance rates,” said Senator Bobby Powell.
Lawmakers say it’s taken years to get to this critical tipping point
“But I’m happy that we’re here talking about it now because we know it’s a crisis in the state and we know that people are suffering and we’ve got to do something so that people can stay in their homes and be able to afford their homeowners insurance,” said Berman.
The special session comes as Florida’s second extracurricular meeting of the legislature in recent months, following the failure of the GOP-controlled statehouse to pass insurance proposals earlier this year during its regular meeting period. There is also increasing urgency for lawmakers to address problems in the state’s market ahead of the looming hurricane season, which in previous years has brought devastating storms to Florida, such as the Category 5 Hurricane Michael in 2018.
‘People are fighting for apartments’: South Florida housing demand driving up rent
The bills would forbid insurers from automatically denying coverage because of a roof’s age if the roof is less than 15 years old. Homeowners with roofs 15 years or older would be allowed to get an inspection of their condition before insurers deny them coverage, under the bill. If an inspection shows that a roof has at least five years of life remaining, insurers can’t refuse to issue a policy only based on the roof’s age under the proposed legislation.
Another measure would provide grants worth up to $10,000 each to retrofit homes so they are less vulnerable to hurricane damage. To qualify, properties would have to have insured values of $500,000 or less, be homesteaded, constructed before 2008 and located in areas where wind speeds from storms can exceed 140 mph (225 kph). Homeowners would get $2 from the state for every $1 they invested in mitigation efforts.
The legislation also seeks to limit various attorney fees in insurance-related cases, which insurers blame for much of the rate increases for policyholders. Supporters of the legislative package have frequently noted that Florida accounted for 9% of all insurance claims filed nationally but nearly 80% of all the property insurance lawsuits.
Palm Beach County mayor: No rent cap to be imposed by county
The bills would allow for more state oversight so regulators can spot trends, analyze reasons and try to prevent the future failure of insurers. The insurance industry has had two years of underwriting losses exceeding $1 billion each year, according to the office of Florida Gov. Ron DeSantis, a Republican. Several insurance companies have either gone insolvent, required midterm cancelations, are in liquidation or have stopped writing new business since 2021, the governor said in his proclamation calling lawmakers back to the Capitol.
The special session is set to run from Monday to Friday.
This article contains information from The Associated Press.
