Florida lawmakers investigate claims that property insurance companies are hiding profits while saying they're losing money

Florida House members Friday began digging into questions about property-insurance companies sending money to affiliated firms and shareholders while arguing the industry was losing money.

During a three-hour hearing, the House Insurance & Banking Subcommittee grilled state Insurance Commissioner Michael Yaworsky and former Commissioner David Altmaier about a 2022 report that, in part, detailed money going to affiliated firms. The hearing came after a Tampa Bay Times/Miami Herald story last month about the report, which had not been provided to lawmakers or released publicly.

Lawmakers said they should have received the report earlier, particularly as the Legislature in a 2022 special session passed major changes to bolster insurers. Yaworsky and Altmaier said the report was a draft and that a final version was not completed.

"Our purpose today is to find out if insurance companies have been allegedly ripping us off, ripping the citizens of Florida off, why rates are so high. We want to find that out," Rep. Mike Caruso, R-Delray Beach, said. "And this report's the state's attempt at determining the answer to that. Yet it's still in draft form. It's only seven pages long. It deals with data from 2017 to 2019. Today's 2025. And I find as a legislator, that's outrageous that we're getting something that's so antiquated and so full of flaws."

Yaworsky, who became commissioner in February 2023, said he became aware of the report in late 2024. He said regulators would produce an updated report if the Legislature wants it.

"I think we want it. I think we're all screaming for it. I'm looking at everybody's heads nodding. And you let us know what resources you need, and we'll make those available," Caruso responded. "I know the number one thing out there to the people of Florida is, they want answers as to why insurance rates are so high."

The 2022 report, conducted for the state Office of Insurance Regulation by Risk & Regulatory Consulting, LLC, involved 53 insurers and looked at issues such income, payments to affiliates and shareholder dividends.

When excluding companies described as "outliers," the report said companies reported an aggregate net loss of $432 million from 2017 to 2019. But it said net income of affiliated firms was $1.8 billion.

The discussion Friday primarily centered on what are known as managing general agents, which are firms affiliated with insurance companies. Insurers pay managing general agents, or MGAs, to perform many day-to-day tasks, such as issuing policies and managing claims.

Rep. Hillary Cassel, a Dania Beach Republican and attorney who represents consumers in lawsuits against insurers, questioned how regulators could receive the report and not pursue issues related to affiliates.

"The problem with managing general agents and their affiliates has existed in this state for a very long time," Cassel said.

Yaworsky said that "if you are a commissioner of insurance and you don't have a concern about perverse incentives that can exist in holding-company arrangements, MGAs and affiliate transactions, then you shouldn't have the job. It is constantly on my mind, along with about a billion other things."

Yaworsky said the state has strengthened rules over the years related to monitoring. But he also said companies' use of MGAs has helped draw investors to the risky insurance market, what he described as a "countervailing balance.".

"The fundamental fact of our marketplace is that it is not one that companies inherently, naturally want to be involved with, especially the companies we want the most to be involved," Yaworsky said. "And this current structure is the structure that they have found to manage to get investors willing to put capital into an entity."

Altmaier, who resigned as insurance commissioner in December 2022, said he had discussions about the report while in the job. But he and Yaworsky said it needed more work. Neither could provide a specific answer about why the report was not pursued further.

"It certainly raised some red flags, which was why it was important for us to determine whether or not this was accurate," Altmaier said.

The report came during a turbulent time in Florida's insurance market, with companies dropping homeowners, raising rates and, in some cases, going insolvent because of financial issues. Lawmakers during the 2022 special session passed a major overhaul that included helping shield insurers from costly lawsuits — an issue the industry blamed for losses.

After last month's Times/Herald story about the report, House Speaker Daniel Perez, R-Miami, directed the Insurance & Banking Subcommittee to conduct hearings that could include issuing subpoenas and taking testimony under oath. Altmaier, who now works as an insurance consultant, testified under oath Friday.

Perez told The News Service of Florida this week the report raised questions about insurers' arguments that led to changes in state laws. During a recording of the News Service's "Deeper Dive with Dara Kam" podcast, Perez said industry representatives told lawmakers that "they would have to essentially close their doors and move out of the state" without the changes.

"And now we believe there's a potential that those cries were not real, that their profits were higher than expected and potentially there was some sort of shell game being played," Perez said. "Now, sometimes when there's smoke, there's not fire and hopefully that's what we find. We want to believe that everyone's an honest broker, but we do have a job to investigate that."

Senate President Ben Albritton, R-Wauchula, also said during a recording of the podcast that he will meet next week with Yaworsky to discuss the report. The podcast with Perez and Albritton will be released Sunday.

"Sometimes things are accurate. Sometimes they're partially accurate, sometimes they're not accurate at all. We want to figure out what the facts and the fact pattern actually says," Albritton said.

— Senior writer Dara Kam contributed to this report.