Contentious residential property insurance bill and others advance out of committee

by | Feb 2, 2021

 

Today, three senate bills were “reported favorably” by the Florida Senate Committee on Banking and Insurance and will advance through the legislative process.

The most contentious of the three was Senate Bill (SB) 76, an act relating to residential property insurance. Committee Chair State Senator Jim Boyd put forward the bill, he said, to reduce residential property insurance premiums for home owners.

Opponents say the bill restricts a homeowners’ ability to reclaim attorney fees if they are successful in a claim against an insurance company in property-insurance disputes and limits how much an insurer is compensated for roof damage following a storm.

The bill addresses what insurance companies see as a “proliferation of litigation that has driven up the cost of property insurance across the state” by requiring detailed notice of property insurance claims prior to litigation and changes how attorney fees are awarded.

“We want to make certain that Floridians have access to property insurance that is both reliable and affordable. Right now we have a situation in our state where homeowners are paying more for their property insurance, and yet insurance companies are suffering massive losses,” said Boyd. “These higher premiums and massive losses directly correspond to an increase in claims, many of which are related to roof coverage and filed years after damage occurs, as well as a huge increase in property insurance related lawsuits.”

The bill clarifies insurance coverage related to roof damage and replacement, reduces the time a homeowner has to file an insurance claim from three years to two, requires that the insured party provided notice of the claim to the insurance company before filing a lawsuit, and changes how attorney fees are awarded in property insurance litigation.

The bill singles out roof-damage claims, as insurers say they have faced a surge of questionable and potentially fraudulent claims. Boyd’s bill requires insurers to use what is described as a “roof surface reimbursement schedule.”

Under the proposal, reimbursements could vary based on ages and types of roofs. Insurers would be required to provide full replacement coverage for roofs less than 10 years old. But they would be allowed to adjust roof claims to actual cash value if the roof is older than 10 years.

Senator Perry E. Thurston Jr. (D), voted against the bill saying, “Something needs to be done (to reduce insurance premiums) but does it all need to fall on the back of the policy holders?”

The committee’s Vice Chair Senator Doug Broxson (R), who supported the bill responded, “We have a collapsing marketplace and I don’t want to see people forced out of their homes because they can’t afford the insurance premiums. It’s hard medicine, but we have to take it.”

The other two bills that were reported favorably were SB 168 which extends hurricane loss mitigation for 10 more years and Senate Proposed Bill (SPB) SPB 7014, which amends a provision that removes the scheduled repeal of an exemption from public records requirements for certain proprietary business information and information that is confidential and held by the Office of Insurance Regulation.

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