Florida lawmakers unanimously approved a bill hiking fines and boosting oversight for property insurance companies, a move supporters said was needed to ensure the companies were handling claims properly following a series of new laws aimed at reducing lawsuits against them.
The bill (SB 7052) increases fines on insurers that mishandle claims, requires the Office of Insurance Regulation (OIR) to issue quarterly reports on enforcement measures, requires more frequent reviews of “high-risk” insurers and insurers who have a high volume of consumer complaints following a hurricane, and requires carriers to inform OIR when they stop issuing new policies and why.
“Property insurers who prey on Floridians with deliberate efforts to reject or reduce legitimate claims deserve to get hammered,” House Speaker Paul Renner, a Palm Coast Republican, said in a released statement.
“Recent reforms by this Legislature to create a healthier and more balanced property insurance market will make homeowner’s insurance more affordable. As more competition enters the market, we need to ensure Florida’s homeowners are not taken advantage of.”
The bill passed unanimously through the Senate last week and will next head to Gov. Ron DeSantis’ desk.
It comes after lawmakers in a December Special Session passed a law eliminating the one-way attorney fee statute and the use of assignment of benefits (AOB) to a contractor, which insurers blamed for skyrocketing lawsuits that have boosted losses and premiums. Lawmakers were responding to the failure of seven companies since the start of 2022 and the large hikes in rates sought by other companies.
But since the law took effect, several companies have sought large statewide average increases, including one as high as 60%.
Some Democrats, though supportive of the bill, wanted stricter requirements on insurers. Rep. Hillary Cassel, a Dania Beach Democrat, noted regulators still had discretion to decide when to impose fines, and insurers weren’t required to report the number of ongoing lawsuits they have.
“I don’t think we go far enough,” Cassel said. “Sadly … this is going to be another bill that, while we pass it, doesn’t provide relief to consumers.”