American Property Casualty Insurance Association: Legal System Abuse Is The Man-Made Catastrophe Impacting Florida's Insurance Affordability And Availability, Not Natural Catastrophes

WASHINGTON, Oct. 8 (TNStalk) -- The American Property Casualty Insurance Association issued the following statement on Oct. 7, 2022:

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David A. Sampson, president and CEO of the American Property Casualty Insurance Association (APCIA), released the following statement emphasizing that legal system abuse is the man-made catastrophe impacting Florida's insurance affordability and availability, not natural catastrophes.

"Right now, and for the foreseeable future, the efforts of the entire industry are focused on helping our policyholders recover from Hurricane Ian. The property casualty industry is deploying all available resources to work with customers to process claims and provide economic assistance to jumpstart the recovery process. We have learned valuable lessons from past storms and are putting them to good use here. For example, the industry put thousands of adjusters into position before the storm made landfall and deployed them immediately to help property owners recover as quickly as possible. All our energy and efforts are focused on helping those whose lives have been upended.

"Earlier this week, President Biden correctly noted the strain on the insurance industry in the state of Florida. While Hurricane Ian hasn't helped that, it is not the only factor. It is important to set the record straight. Prior to Hurricane Ian's landfall, Florida had not experienced a major damaging hurricane since 2018, and yet the state has seen eight insurers go insolvent in the last two years and consumers have struggled with higher costs and insurance availability. Unfortunately, the blame for this man-made catastrophe goes to the vast abuse of Florida's legal system and rampant fraudulent and abusive roof replacement schemes, not because of natural disasters.

"The impact of lawsuit abuse and fraud has reached crisis levels for a growing number of insurers, as losses have drawn down reserve capital while costs to secure additional capacity through reinsurance have increased. Florida accounted for 76% of the nation's homeowners insurance lawsuits over claims filed while making up only 7% of the nation's homeowners insurance claims. To further put it into perspective, another study found that insurers paid $15.3 billion for insurance lawsuits in Florida from 2013 to 2020, of which 71% funded plaintiff attorney fees, 21% represented defense costs, and only 8% went to policyholders.

"Policymakers in Florida took strong first steps this summer to address this crisis during a special legislative session. Reforms enacted include key provisions to protect policyholders and bring more fairness to the legal system. However, it will take time before they s start to improve the insurance marketplace and it is likely that more reforms will be needed to further stabilize the state's property insurance marketplace.

"Now is the time for serious people to work on serious problems. We look forward to working with state and federal policymakers on the challenges ahead."

The American Property Casualty Insurance Association (APCIA) is the primary national trade association for home, auto, and business insurers. APCIA promotes and protects the viability of private competition for the benefit of consumers and insurers, with a legacy dating back 150 years. APCIA members represent all sizes, structures, and regions--protecting families, communities, and businesses in the U.S. and across the globe.

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Original text here: https://www.apci.org/media/news-releases/release/73419/