A recent article from Miami Herald titled “Did Lawsuits Cause Florida’s Insurance Crisis? Evidence Remains Scarce’ highlights the challenges Floridians face in dealing with rising insurance premiums.
Despite state government efforts to curb lawsuits and claims that litigation is driving premium increases, there is little evidence to support that, according to the Miami Herald. Premiums continued to rise and thirteen insurance companies went out of business, though not directly due to litigation.
Lawmakers expressed frustration at the lack of concrete data on how lawsuits affect premium costs, with one senator comparing the availability of information to recent UFO revelations. There are indeed a large number of lawsuits against insurers in Florida, and while some of them may be malpractice, there is a lack of research into the proportion of excessive or frivolous lawsuits compared to legitimate complaints. Insurers in Florida may contribute to the high litigation rate by trying to minimize payouts, with allegations of manipulation to deny or undervalue claims.
The Herald article goes on to discuss the long-standing attribution of Florida’s insurance crisis to lawsuits by insurance companies, state regulators and many lawmakers.
“It’s unfortunate that the Florida Legislature didn’t have the foresight to outsmart the insurance company,” says personal injury attorney David Sampedro, “The insurance industry lobbyists convinced the legislature that these draconian anti-consumer laws would lower insurance premiums. Instead, insurance companies raised premiums while laughing all the way to the bank.
Efforts by Governor DeSantis and the Legislature to address the problem include limiting the ability of homeowners to assign insurance benefits to contractors, similar to assigning benefits to health care providers. In addition, a significant legislative change includes ending a long-standing requirement that insurance companies pay attorneys’ fees when plaintiffs sue and win, a move seen as historic by insurers and business groups.
“We’ve seen this before,” says veteran attorney Mitch Panter, “When malpractice reforms were enacted, the insurance industry promised reduced malpractice premiums for health care providers. That didn’t happen. Any time consumer rights are taken away for the benefit of insurance company profits, it benefits no one but the insurance companies. When will our regulators learn? Or at least try to make sure that the premiums are reduced to compensate for the benefits removed from the insured.
Florida’s insurance crisis, which occurred in 2017 after the end of a 12-year storm-free period, lacked comprehensive studies by the Legislature to identify contributing factors. In 2021, lawmakers authorized state regulators to collect more detailed data on lawsuits from insurers. However, the publication of the initial findings has been delayed, in part because 71% of insurance companies failed to submit the required data initially, with a further 18% missing the deadline.
While insurance companies previously attributed the rise in claims to contractors suing homeowners for storm-related damage, a 2021 law shortened the deadline for filing claims from three years to one year after the incident. However, a 2020 study by Florida Insurance attorney Tasha Carter suggested that cases blamed on contractors were likely in the minority, as approximately 80% of claims were filed within two weeks of the loss.
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Panter, Panter & Sampedro is a leading personal injury law firm dedicated to protecting Florida families. For more than 30 years, our experienced trial attorneys have worked personally with clients to successfully obtain the justice, restitution and compensation they deserve. If you think you may have a claim against an insurance company, speak with a dedicated attorney today by calling (305) 662-6178.
Mitchell Panter, Esq. is a certified civil trial attorney, community attorney, and managing partner at Panter, Panter & Sampedro, PA
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