TALLAHASSEE, Fla. – Florida’s House of Representatives are expected to vote on property insurance legislation Wednesday after Republicans passed a state bill that Democrats fear could end up hurting homeowners who are already struggling to cover their cost of living.
Lawmakers are also expected to vote on a bill that would limit attorneys’ fees in lawsuits against insurers, among other changes that include requiring policyholder Citizens Property Insurance coverage to also carry flood insurance.
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“There’s nothing that I’ve seen that actually will bring rates down for homeowners,” said House Minority Leader Rep. Fentrice Driskell (D-Tampa). “And that’s the number one complaint that we get from our constituents is that the rates are just too high.”
The average cost of property insurance in the state is about three times higher than the national average. On average, rates have gone up by about 33% each year.
“Homeowners in Florida are being crushed right now by the cost of housing and insurance costs are a major part of that,” said Democratic state Sen. Darryl Rouson. “Any action that does not address the instability and costs to the consumer and does not provide meaningful near-term relief for policyholders, I believe falls short of our goals.”
According to the Insurance Information Institute, a research organization funded by the insurance industry, about 12% of homeowners in the state don’t have property insurance, compared to the national average of 5%.
Republican lawmakers also said that Florida would become the 40th state in the nation to no longer allow “one-way attorney’s fees” if the bill becomes law. Several trial attorneys say that it would block consumers’ access to the courts.
In addition to the cancellation of one-way attorney’s fees, the legislation would create conditions allowing insurance companies to persuade policyholders to sign a “mandatory binding arbitration” agreement.
Both parties agree there is a need for action. During the Florida senate’s special session on Tuesday in Tallahassee, Florida Sen. Ileana Garcia, a Republican from Miami, said it hits close to home.
“I am living with my mother because I foresee what would happen to her,” Garcia said during the meeting.
Florida Sen. Jim Boyd, a Republican from Bradenton, introduced a bill that would force taxpayers to give $1 billion to insurance companies.
“I think everything we’re trying to do today is to drive prices down,” Boyd said during the session. “Our goal is to lower those premiums.”
Boyd also answered some questions about his bill, which he said will help to stabilize the property insurance market. Florida Sen. Jason Pizzo, a Democrat from Miami-Dade, was among the legislators who were not convinced.
Boyd’s bill would require homeowners to buy flood insurance if they had a policy from the Citizens Property Insurance Corporation, which the state created in 2002 to provide insurance to homeowners who struggled to find coverage.
Pizzo said it’s “absurd” that somebody who is forced to buy Citizens, the low-cost homeowners’ insurance provider in the state, and who lives on the 20th floor of a high-rise building would need to buy flood insurance.
“We cannot leave the consumers behind while we try to stabilize the market,” said Sen. Geraldine Thompson, a Democrat from Orlando said during the session on Tuesday.
Democrats were also concerned that Boyd’s bill would also not allow some Citizens’ policyholders to renew their insurance if a private insurer offers an option within 20% of the cost.
The bill would also require homeowners to file claims within one year, instead of two, and to make supplemental claims within the first 18 months of the damage, instead of three years.
The billing concerned trial lawyers who have been concerned that the Republicans’ bill could make it difficult for homeowners to dispute an insurance company’s refusal to cover a legitimate claim.
The bill also makes changes to the Florida Hurricane Catastrophe Fund, a reinsurer that legislators created during a special legislative session in 1993 after Hurricane Andrew and it forced property insurers to buy it at below-market rates.
Members of the Congressional Black Caucus held a news conference before the session on Tuesday to express their fears. State Rep. Dianne Hart, a Democrat from Orlando, said homeowners are being forced into foreclosure.
“Our consumers are really suffering,” Hart said. “This bill does nothing for the homeowner and we must do something for the people.”
“The point of this bill is to lower the cost of homeowners insurance for the people of Florida.” Rep. Ralph E. Massulo (R) said at the special session. “We do that because Florida’s homeowners insurance is extremely expensive because the market is deteriorating. In time, if we don’t act, there won’t be a market.”
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Vanessa Albaugh, 17, tells legislators her hurricane-destroyed home in Mexico Beach is part of what is called the Forgotten Coast. "I do feel forgotten,'' she said."I feel forgotten by my insurance company. I feel forgotten by my neighbors. And now I feel forgotten by my state." pic.twitter.com/R9PUOLVONy
— Mary Ellen Klas (@MaryEllenKlas) December 13, 2022