Florida House Approves Historic Insurance Reforms, Sending Bill to Governor


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One day after the Florida Senate approved a landmark revision to Florida’s property insurance rules, the House followed suit, perhaps bringing to a close an era of surging claims litigation, insurer insolvencies and escalating premiums.

Florida’s second special legislative session on the insurance crisis ended Wednesday, earlier than scheduled, after Senate Bill 2A sailed through both chambers with plenty of discussion but no changes. After three years of grappline with an insurance market that has been called “distressed,” “imploding” and “insane,” many stakeholders breathed a sigh of relief and praised the scope and breadth of the reform measures.

“We want to thank all our brothers and sisters in the Florida Legislature for helping put Florida on the right track toward fixing the insurance industry,” Carlos Beruff, chairman of the Citizens Property Insurance Corp. board of governors, said in a statement. “This bill will not only help Citizens, but will stabilize the market for insurers and policyholders across the state.”

The bill aims to return the state-created Citizens to the realm of insurer of last resort. Insurance agents who sell Citizens’ policies may be as affected as anyone and will have to explain that some policyholders will soon be forced to buy more expensive policies in the primary market. If they remain with Citizens, all policyholders will soon have to buy flood insurance, a key section of the bill.

The business community, fearing that Florida’s tick-tight insurance market was scaring away development, applauded the bill’s passage.

The bill “protects Floridians by making significant strides towards long-standing Florida Chamber priorities, specifically reining in Florida’s lawsuit abuse problems, eliminating cost drivers ripe for fraud such as assignment of benefits, and reducing future hurricane taxes by taking steps towards returning Citizens Property Insurance Corporation back to the insurer of last resort,” said Chamber President Mark Wilson.

Trial lawyers, often blamed by insurers for generating thousands of unnecessary or premature claims lawsuits and bad-faith actions, weren’t so impressed.

Rep. Fentrice Driskell, D-Tampa, tried to expand the agenda at the session to include more accountability for insurers and limits on conditions that carriers could exclude or deny, but her bill was voted down. (AP Photo/Phil Sears)

“Unfortunately, this round of reforms is a massive overcorrection that takes away homeowners’ property rights and leaves Floridians at the mercy of their insurance company,” reads a statement from Ron Haynes, the Florida Justice Association’s property insurance section vice chairman.

Haynes echoed what some independent claims adjusters said this week – that unjustly denied and underpaid claims have led to the volume of litigation in recent years.

“Litigation isn’t the problem – it’s the scapegoat,” Haynes said. “Behind every lawsuit is a homeowner or business owner who has been underpaid or wrongfully denied coverage.”

The far-reaching bill was said to have been drafted mostly by state Sen. Jim Boyd, a second-generation insurance agency owner and chair of the Senate Banking and Insurance Committee, with input from House leaders, the governor’s office, the insurance industry, and the Florida Hurricane Catastrophe Fund leaders.

The draft of the measure was revealed Friday evening, Dec. 9. By Tuesday, Dec. 13, the full Senate voted mostly along party lines, 27-13, to endorse it, with no amendments. On Wednesday, the House approved it 84-33. Gov. Ron DeSantis is expected to sign it into law this week, and most provisions will take effect immediately.

The key changes can be seen here.

Lawmakers and insurance groups cautioned that it could still be another two years before remedial effects of the legislation are fully realized.

Top photo: Newly installed Florida House Speaker Paul Renner, R-Palm Coast, opened and closed the special session this week. (AP Photo/Phil Sears)

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