Two years after reforms, lawmakers share insurance horror stories

Florida’s insurance commissioner might not want the Legislature to pursue any major new reforms during the upcoming session, but lawmakers on House and Senate committees that determine which bills advance might not be so patient.

Two years after voting to enact reform bills aimed at reducing rates of claims abuses and litigation against insurers, lawmakers arrived at two meetings in Tallahassee prior to the March start of the 2025 legislative session loaded with complaints from constituents and questions about the state of Florida’s insurance industry.

What remains to be seen is whether the concerns expressed on Tuesday will result in actual bills intended to reduce costs and improve how fast insurers pay claims and respond to homeowners’ claims.

The hearings were billed as open discussions to explore ideas ahead of the session. No actual bills were debated and no private-market insurance companies were identified by lawmakers who described consumers’ frustrations.

During the afternoon meeting of the House Subcommittee on Insurance and Banking, Rep. Michael Caruso, a Republican from West Palm Beach, described getting a letter from an 83-year-old Fort Myers woman whose home was “tremendously” damaged during Hurricane Ian in 2022. Nine months later, she had only received $10,000 from her insurer, he said. “She’s still waiting” for her insurer to pay off the rest of her claim.

Meanwhile, the insurer reassigned her claim to new adjusters seven times, he said. Three times, the insurer sent out engineers to inspect her damages.

“It’s just a deferral,” Caruso said, characterizing the insurer’s attitude as, “we’re just not going to pay this lady.” He added that the woman still hasn’t been able to return to her home. “I think she’s going to die before she gets her money,” he said. “And that’s sad.”

He asked, “I want to know, why is this happening? What are we doing as a state to resolve this and to prevent this from happening?” Caruso said he voted for the reform measures in 2022 to reduce litigation under the promise it would also lower rates and improve insurer responsiveness. “And I feel like the insurance companies are failing us and it’s abominable.”

Rep. Daniel Alvarez, Republican from Riverview in Hillsborough County, said, “When I’m on the street, I simply don’t know how to talk to my constituents” when they bring up their insurance issues.

“This is what I know: I know I voted on a bill that every insurance expert told me, ‘Give me two years, Danny, before you start getting hot, right? And you will see either prices stabilize and come down or come down, and I don’t know that I’ve seen either of those two. And when I’m the guy who faces the consumer, I just don’t know what to tell them anymore other than, ‘I’m sorry.’ I’ve got people leaving because they can’t afford it anymore and this is the main driver.”

Rep. Marie Woodson, a Democrat who lives in Hollywood and represents parts of Broward and Miami-Dade, said her insurance premiums have quadrupled over the past several years. “And it’s not just me,” she said. “All my constituents are saying the same thing.” She asked, “What is the timeline that you have for constituents to start seeing the savings that you are talking (about)?”

During the earlier meeting of the Senate Committee on Banking and Insurance, Sen. Jason Pizzo, a Democrat representing coastal Broward and Miami-Dade counties, complained that insurers are allowed to invoke “trade secret” protections that prevent lawmakers and the public from seeing data insurers are required to submit to the Office of Insurance Regulation about the number of lawsuits filed against them. To challenge a trade secret designation, he has to file a lawsuit, Pizzo said.

“I voted for Senate Bill 76 (which restricted lawsuits against insurers) and I got a one-page summary” of the litigation data from the Office of Insurance Regulation, he said. Seeing the data, he said, would help him identify rogue insurers “that outright reject claims.”

Sen. Barbara Sharief, a Democrat representing the eastern side of Broward County, said policyholders in her district who are removed from state-owned Citizens Property Insurance Corp. through the state-mandated depopulation program are seeing premium increases of 40% and in some cases 50%.

Several industry experts attended the House subcommittee meeting.

Chad Karr, a real estate agent in Lakeland, told the House subcommittee that he filed both a flood insurance claim and a homeowner insurance claim after his home was damaged in succession by hurricanes Helene and Milton last year. As a result of facing two deductibles, Karr said he has so far spent $122,000 on repairs and is still living in a camper. He said his homeowner insurer “is just dragging their feet.”

“They sent out very inexperienced appraisers. They play games. So now we’re looking at having to hire public adjusters,” who will take 10% of what he recovers, Karr said.

“I have clients that are still waiting and they’ve just been put on the back burner, almost to the point that they look at it and go, ‘Are they doing this to us on purpose? Are they doing this so we don’t make a claim?'”

Chip Merlin, founder and president of Merlin Law Group, rattled off a list of reasons why “people are very frustrated with the insurance product.”

Merlin asserted that insurers are raising rates based on the age of homes even if the home is in good condition and roofs have another 10 years of life left.  Deductibles are too high, small print in policies limit coverage, insurers have stopped paying to match the quality of damaged items, and policyholders too often find out that damage isn’t covered because their deductibles are too high, Merlin said.

“And these things tend to frustrate people after paying what they think is a very high amount” for coverage, he said.

Throughout both meetings, Florida Insurance Commissioner Michael Yaworsky stressed that the reforms enacted in 2022 have improved availability of insurance and prevented costs from increasing even more.

The Office of Insurance Regulation is monitoring insurer conduct very closely, he said, and levied $2.8 million in fines against insurers caught violating the law. “When necessary, we will take action and we are watching very, very closely,” he said.

The average requested rate changes submitted to the Office of Insurance Regulation, he said, declined from 12.9% over 180 days two years ago to 6.2% a year ago and to 1% today, he said.

Nine new insurers, encouraged by the reforms, have entered Florida’s market over the past two years, Yaworsky said. The insurance industry returned to profitability in 2023 and 2024 following seven years of losses. That stabilized the industry enough to handle hurricanes Milton and Helene last year, he said.

If Milton and Helene had happened in 2022, “we would undoubtedly have a number of insolvencies taking place,” he said during the Senate committee hearing.

Even as the reforms have stabilized the industry, premiums have increased but that’s because inflation has increased the value of homes that policyholders are insuring, Yaworsky said. That value, expressed in insurance-speak as Total Insured Value, or TIV, increased by about 40% in Florida since 2021, he said.

“It means that the consumer at the end of the day is having to pay more because the cost to replace their home and put themselves where they were before they had the accident is a much more costly endeavor than it was a couple years ago,” Yaworsky said.

In December, a deputy commissioner of the Office of Insurance Regulation said at the Florida Chamber’s annual Insurance Summit that Yaworsky wouldn’t be asking the Legislature to enact any major new reforms during the upcoming session. He wants “status quo for now” and time to better analyze effects of the previous round of reforms, the deputy commissioner said.

Yaworsky did not relay that request to the lawmakers he addressed on Tuesday.

“This is not my first exposure to consumers that are experiencing a difficult time,” he said. “The thing about insurance is we’re all in this together at the end of the day. Prices go up for all of us or they go down for all of us, ultimately over time, and it’s really just in the margins where they change.”

Ron Hurtibise covers business and consumer issues for the South Florida Sun Sentinel. He can be reached by phone at 954-356-4071 or by email at [email protected].

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