The House on Wednesday voted overwhelmingly in favor of HB 7071, sponsored by Rep. Mike Beltran, to limit exorbitant attorney fees on property insurance lawsuits.
HB 7071 now heads to the Senate, which must decide if it will hear the companion bill in its last remaining committee reference, the Senate Rules Committee.
SB 914, sponsored by Sen. Jeff Brandes, was last considered favorably by Senate Judiciary Committee on Feb. 4, but has remained stagnant for a month.
“I’m confident that this bill will restore the balance to this area of law,” Beltran said on the House floor. “And it will allow folks to continue to litigate valid claims and that attorney fees will be more reasonable.”
The legislation, which passed 72-46, has the backing of Floridians. Last month, more than 1,000 petitions were hand-delivered to the Legislature calling on them to act to alleviate homeowners’ property insurance rates by putting an end to contingency risk multiplier fees on property insurance claims, except in rare and exceptional circumstances.
Tort reform has long been a priority of Gov. Ron DeSantis and the Legislature. At an event last fall, where it was revealed Florida remains one of the worst legal climates in the nation, DeSantis said:
“That, to me, is more of a lawyer-driven culture than it is based on people who actually suffer harm. If we can make it so that it’s based on the clients rather than the attorney, I think that would be better.”
Contingency risk multiplier fees enable trial attorneys to pocket up to 30 times more than the value of the property insurance claim they represent. Trial attorneys are using homeowners’ claims to collect six-figure paydays, and insurance policyholders are footing the bill through higher premiums.
In one example, a trial attorney was awarded $1.2 million on a $40,000 dispute. In another, the trial attorney took home $750,000 on a $19,000 award. And in another, the trial attorney banked $700,000 on a $35,000 settlement.
In 2020, the Florida Office of Insurance Regulation has received requests from insurance carriers for rate increases so they can manage the exorbitant fees and rising costs of litigation. Rate increase requests range from 20% to 40%, and soon, if meaningful reform is not enacted, Florida homeowners will be paying the price.