“This vote was cast before these members ever stepped into this room” – Trial attorneys fail to slow advance of insurance reform bill during special session
They argued in vain against the premise of SB 2-A, an effort to limit the claims litigation against insurance companies that the bill's proponents blame for escalating premiums and the departure of insurers from the
Meanwhile, lawmakers gave no assurance that the measure would lower premiums in the near term.
The proposed insurance legislation would authorize
The
The other target is
This, too, would be scrapped under the bill to "root out the cause of the frivolous litigation that's driving the costs up," according to Banking and Insurance committee chairman
"We have got to get at that root cause, because it's costing all of us and our constituents more than they can afford," Boyd said.
"Until we deal with that in addition to our concerns about litigation, etc., we're really not solving the insurance problem," Thompson said.
DeSantis' involvement
The plaintiffs' bar, represented by the
The difference?
"
"I would say this vote was cast before these members ever stepped into this room," Murray said.
According to Boyd, 39 states lack the one-way attorney fee requirement;
Although the bill would forbid AOBs, it would allow either party to a claims lawsuit to recover its attorney fees if the other party rejects a settlement offer that a judge ultimately found was justified — which "I believe levels the playing field," Boyd said. The award would have to exceed the offer by at least 25 percent, however.
Trial attorneys and some private citizens complained that insurers have been abusing the insurance appraisal process in handling claims, sending one adjuster after another to inspect damage in order to delay paying claims.
Under Boyd's bill, the
Insurers, in turn, complain that parties wielding AOBs sometimes file suit before giving them a fair chance to settle claims. Moving those third parties out of the process — "That's the way insurance is supposed to work. The homeowner has a contract with the insurance company for a premium and if anything happens they're going to cover you. The lion's share of the time, that's what happens," Boyd said.
Bad faith
In addition, a policyholder no longer would automatically have a claim for bad faith if he or she forces the carrier to improve on an initial offer of settlement — instead, the customer would have to establish breach of contract.
People could be forced out of the
A similar mechanism would discourage Citizens from insuring most second or vacation homes; owners would be kicked off Citizens if they can find a private-market policy for less than 50 percent above their Citizens' rate.
The idea, Boyd said, is to reestablish Citizens as "truly what it was meant to be, the insurer of last resort." Citizens has been picking up customers forced out of the private market to the point that it now is carrying 1.4 million policies — a trend would endanger the company's reserves if allowed to continue.
The legislation also would allow insurers to offer customers binding arbitration agreements to resolve claims disputes — but they'd have to offer cheaper rates in exchange.
During a separate special session in May, the Legislature used tax dollars to create a
The bill would create another temporary,
This report first appeared on the website of the Florida Phoenix, a nonprofit news organization dedicated to coverage of state government and politics from
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