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May 26, 2024

DeSantis to call special session in May to address property insurance reform

Gov. Ron DeSantis will call a special session next month to address property insurance reform, he said Monday at a press conference in Jacksonville, where he also announced funding for a trauma center at the University of Florida.

It’s the second special session DeSantis has called this year. Next month, the legislature will convene to address redistricting. Now it will also address property insurance. And it may address additional issues, DeSantis said.

This year’s regular legislative session was very productive, DeSantis said, but there were some issues the legislature was working on that “didn’t quite make it over the finish line.” He said if the legislature could “get to a place where we can punch [these issues] through we would absolutely do a special session,” including property insurance reform. Doing so would hopefully “bring some sanity and stabilize a functioning market,” he said.

The governor said he is confident “that we’re going to be able to get that done,” adding he’ll be signing a proclamation this week to set the dates for a special session in May. The main focus will be on property insurance reform, he said, but could include other issues, although he didn’t say which ones.

Last year, the legislature passed a property insurance reform bill, SB76, which DeSantis signed into law and went into effect July 1.

It includes several provisions, including limiting the practices contractors can engage in, limiting claimants’ attorney fees, requiring policyholders to file claims within two years of incurred losses, strengthening state oversight of companies affiliated with Florida property insurers, requiring Florida residential property insurers to annually file a comprehensive report related to closed claims, and raising the cap on Citizens Property Insurance Corp.’s annual rate increases to a maximum of 15% in 2026, Florida Realtors explains.

At a roundtable discussion in Sarasota last June when he signed the bill into law, DeSantis said, “Many of you know over the last decades, there’s been a lot of ups and downs in this property insurance market in Florida,” Insurance Journal reported. “We saw a lot of problems. You’ve seen major premium increases and you even see some homeowners, their policies get canceled. They get dumped onto citizens. So, we wanted to do something to stabilize that.”

The bill’s sponsor, Sen. Jim Boyd, who owns Boyd Insurance & Investments in Bradenton, said in a press release, “Homeowners property insurance rates have increased by 20, 30, 40 percent or higher in some cases. Since 2013, $15 billion has been paid out in claims in Florida. From those funds, 71 percent went to attorney fees, 21 percent to insurers defense costs, and a mere 8 percent went to the property owners for their losses. Florida accounted for over 76 percent of all homeowners’ litigation in the country in 2019.”

The new law will help rates go down, he said, and “save our constituents on their annual homeowners insurance costs.”

“Florida’s property Insurance market has been in crisis for years,” state Rep. Bob Rommel said in a statement when the bill was signed into law. “Besides weather events, bad actors have been targeting homeowners and insurance companies. Over the past 7 years, insurance companies have paid out over $15 billion in claims, out of which over $10 billion went to attorney’s fees.

“SB 76 is a big step towards stopping the abusive practices of these few bad actors, where they encourage homeowners to file insurance claims or even lawsuits. We have over 1,100 people a day moving to Florida and we need to ensure that consumers have the ability to obtain affordable insurance policies from private companies and not just Citizens, which was originally set up as the insurer of last resort. SB 76 will stabilize the market and should attract new insurance carriers to Florida.”

Industry groups issued statements mostly expressing support for the new law.

However, Progress Florida’s executive director, Mark Ferrulo, issued a statement criticizing it, saying that DeSantis “has raised taxes on all Floridians by $1 billion to fund tax cuts for the largest corporations, raised property taxes to slash impact fees for the largest developers, and now he’s raising property insurance rates for homeowners while making it easier for insurance companies to deny claims for damages and forcing people out of Citizens and into more expensive private plans.”

This article was originally posted on DeSantis to call special session in May to address property insurance reform

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