APCIA Outlines Top Priorities for the 2024 Florida Legislative Session

TALLAHASSEE, Florida, Jan. 9 -- The American Property Casualty Insurance Association issued the following news release on Jan. 8, 2024:

The American Property Casualty Insurance Association (APCIA) today outlined its top priorities for the 2024 Legislative Session, which include: working with lawmakers to ensure the legal system abuse reforms passed in 2022 and 2023 remain in place to give them time to improve Florida's property insurance market, continuing to support efforts to enact strong consumer protections around third-party litigation financing, and supporting policies that will improve the Florida property insurance marketplace and increase the state's resiliency against natural disasters. APCIA also supports Governor Ron DeSantis' budget recommendations related to property insurance, including providing a one-year tax exemption on homeowners insurance policies and providing funding to make the My Safe Florida Home program permanent.

"This session, APCIA looks forward to continuing to work with lawmakers to ensure consumers are protected from ongoing sources of legal system abuse and claims fraud, and that the historic reforms passed in 2022-2023 remain in place," said Logan McFaddin, vice president of state government relations for APCIA. "The 2022-2023 reforms are already having a positive impact on Florida's property insurance market. Over time, consumers should start to see the benefit through improved availability and affordability of insurance, but the reforms must be given time to work."

Protecting the Recent Legal System Abuse Reforms

The extensive reforms passed by the Florida Legislature and signed into law by Governor DeSantis in 2023 were necessary to put an end to years of unchecked legal system abuse and claims fraud that caused insurance costs to skyrocket and insurance companies to become insolvent. Before Florida's leaders took bold action, Florida had 76 percent of the homeowners insurance lawsuits, but fewer than 7 percent of the nation's homeowners insurance claims, according to the Florida Office of Insurance Regulation (OIR).

Unfortunately, right before the reforms went into effect, a staggering 280,000-plus lawsuits were filed by trial lawyers. While it will take time for the last-minute influx of litigation to work its way through the system, the reforms put in place have created a strong foundation for the market moving forward and positive impacts are already being realized. This includes six additional insurance companies entering the Florida market in 2023, as well as greater participation and interest in the Citizens Depopulation Program. In 2023, OIR approved more than 650,000 Citizens policies to be assumed by insurers, representing more than an 800 percent increase over the previous year.

"Before comprehensive legal system abuse and claims fraud reforms were passed by the Florida Legislature and signed into law by Governor DeSantis, Florida's insurance marketplace faced rampant litigation that drove up costs. APCIA is grateful Florida's leaders tackled these tough issues head on in 2022 and 2023. As a result, we are seeing encouraging signs that the reforms are working as the market expands and more options become available to consumers," added McFaddin. "Protecting the reforms and ensuring they remain in place will help ensure this positive momentum continues to the benefit of Florida homeowners."

Third-Party Litigation Financing

APCIA supports efforts by Florida lawmakers to enact strong consumer protections around third-party litigation financing (TPLF), such as capping interest rates, fees, and charges, and providing registration requirements for litigation financiers and requiring disclosure of this practice.

TPLF, or lawsuit lending, is when an unrelated third-party investor finances a lawsuit. This secretive and unregulated practice injects an unknown third party into claims and litigation, enhances the possibility of frivolous lawsuits, and threatens to drive up the costs of products, services, and insurance across Florida.

The lack of regulation for this industry means that lenders - often hedge funds or foreign actors from other countries - are able to charge interest rates as high as 100 percent or more, which could leave an accident victim with little to no award money. Additionally, this secretive practice means defendants and courts do not know when a third-party lender is involved or who they are.

"Third-party litigation financing is an extremely concerning trend in litigation that is turning courts into money-making machines for investors," said McFaddin. "APCIA supports House Bill 1179 and Senate Bill 1276 as a way to protect consumers and bring transparency to this highly predatory industry."

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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/78451/