TALLAHASSEE, Fla. — The Florida Legislature made moves Wednesday to hold bad property insurers more accountable.
Lawmakers advanced a bill they think will bring more transparency and harsher penalties to companies not acting in good faith. That comes as Floridians continue to struggle with increasing rates.
It was last December, just before lawmakers approved reforms to bolster Florida's collapsing property insurance market, that Sen. President Kathleen Passidomo, R-Naples, gave a stark warning.
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"I don't want it to be a scenario where all the reforms that are in place are working, and the rates don't come down," she said. "If that happens, there will be hell to pay."
Four months later, senators in the Banking and Insurance Committee unanimously advanced SB 7052 with an inaugural vote, bolstering the "hell" to which Passidomo was referring.
"The idea is not only are we going to hit those bad actors a little harder — but we're going to make sure everybody knows who they are," Sen. Travis Hutson, R-Palm Coast, who is sponsoring the "insurance accountability" bill, said.
The 46-page policy has more than 20 provisions giving state officials at the Office of Insurance Regulation (OIR) upgraded punishments to target bad actors. Plus, the bill contains new consumer protections to ensure insurers can't cancel policies suddenly and that claims are honored fairly with state supervision.
It also addresses some post-Hurricane Ian concerns.
A Washington Post story that was published last month suggested regional insurers in Florida were quietly rewriting adjuster claims and devaluing payouts by as much as 80%. Hutson said his bill requires receipts to keep things transparent and honest.
"If somebody alters anything — they need to explain why," Hutson said. "And that has to be given to OIR, so they can look at it."
Insurers weren't a fan of that change.
In public comment several representatives spoke out, suggesting the burden of that oversight was too much for the state to handle. Others suggested approval of the policy could again drive up litigation, which is one of the reasons Florida's insurance market is struggling to begin with.
"We urge you to be wary of passing laws that have unintended consequences that run counter to essential reforms this body has fought hard for before they can express themselves in the marketplace," Gary Guzzo, a lobbyist for the Florida Insurance Council, said.
Wednesday was the bill's first of several committee stops. Changes are possible as the bill advances, but Hutson said he was committed to keeping the transparency protections intact, especially when it comes to adjusting. He believed the House and governor were on board with the provisions as well.
Meanwhile, property insurance prices continue to climb in the state with no end in sight. The Insurance Information Institute, in a recent report suggested an average statewide increase of 40% or more in 2023.
