Florida’s new property insurance legislation does not lower rates, encourages insurance companies to delay and underpay claims and makes it much more expensive for Florida seniors and businesses to force wrongful acting insurance companies to pay what is owed.
While Florida’s lawmakers and the governor certainly want to lower insurance costs, stabilize the insurance market and enhance consumer protections so that Florida’s policyholders can count on prompt and full payment following catastrophes, SB 76 does none of these things.
Most insurance laws are fairly similar throughout the country. Model property insurance legislation with small variations is made by the National Association of Insurance Commissioners. It often takes years of study and debate before these suggested model laws are approved because insurance law is very technical.
The language found in Florida SB 76 was hastily drafted. It has defined new insurance terms of art found nowhere else and which make little sense. They seem to create new requirements and roadblocks for policyholders with legitimate claims to get paid. Worse, the new legislation allows the absurd situation of an insurer agreeing that an item of damage would be owed, but because of these new subtle legal technicalities, does not have to be paid.
From discussions with many legislators, the flaws in this legislation was not their intent. Except for legislators in bed with the insurance industry, most wanted to stop fraudulent roof claims and spurious litigation of those claims. In the haste and pressure to do something about these problems, SB 76 harms policyholders with legitimate claims who are not being treated properly by their insurance companies.
It does not take a rocket scientist to figure out it is far more profitable for insurance companies to take people’s premium dollars and not pay for what is owed. SB 76 encourages more of this wrongful activity and in the long run, will create more litigation albeit at the cost to the innocent policyholder who just wanted a fair payment of a claim.
Chip Merlin is founder and president of the Merlin Law Group in Tampa, which has now grown to a national law firm. Merlin represents and advocates for insurance policyholders in disputes with their own insurance companies.