Florida Property Insurance: A Change to Property Damage Claims (2023)

Property owners in Florida know there is something amiss regarding their commercial property and homeowner's insurance coverages and premiums. Over the past years, Florida property insurance carriers have changed strategies including limiting coverages; increasing premiums and requiring interior and exterior home inspections.  As a property owner and in the insurance field I highly recommend and agree with inspections of properties to understand what condition the major areas of your home are maintained and do not need repairs. 

Why are the changes to the insurance industry and laws  important everyone in Florida?  In December 2022, state lawmakers said they were going to fix Florida's property insurance crisis by making changes.  The changes promised to help the property owners of Florida and were going to lower insurance rates.  What happened in reality is, what many homeowners and commercial property owners are coming to learn. 

The December legislation was in response to numerous late-season hurricanes hitting Florida. Six property insurance companies and counting, have recently gone into receivership and or left business in the State of Florida. These insurance company issues are related in part to the location of Florida, the weather and storm frequencies,  the bad actors (as are in every industry unfortunately) there are many factors that have contributed to record price hikes for consumers, but that is not the largest problem for Florida residents in the future.

What does this mean for property damage and  insurance claims in 2023? Keep reading to learn more about the latest Florida property insurance reform.

2023 Florida Property Insurance Changes

Governor Ron DeSantis signed substantial changes to Florida's property insurance statutory regulations and State laws effecting agencies that regulate insurance. No matter who you ask, the changes in the recent law is a game-changer for the property insurance market, and not positive.

The Florida Legislature adopted the laws without allowing amendments that were requested and petitioned to the Legisture during the special session in December 2022.  . Here are some of the most significant insurance hurdles for the insureds.

Eliminations

New changes will impact practices that were common with Florida property insurance claims. 

The changes eliminate the following:

• one-way lawyer's fees
• assignments of benefits (AOB)

One-way lawyer fees allowed attorneys' fees to be paid in cases where the insured won lawsuits against the insurance company where the insurance companies were denying, delaying and underpaying claims wrongfully.  As insurance companies have the resources to have attorneys on their side for these decisions of policyholder claims, the fee statute was in place to “level the playing field” and allow the insureds the same benefits as the insurance companies; to have legal advocates.  The one-way fee statute was really a two- way fee statute as both sides fees’ were paid and ONLY paid to the insured’s attorney IF they won and reversed the claim decision by the carrier. That is not available now. Property owners will likely either have to pay out of pocket for an attorney or have up to 40% of their claim amounts provided as attorney fees plus costs. 

An AOB is a contract that gives a third party the power to make claims, repairs, or collect insurance payments on behalf of the policyholder. This option will no longer be accepted for homeowner or commercial policies either.

Lawmakers inserted mandatory practices such as allowing insurers to include binding arbitration clauses in policies. For a homeowner to get fully reimbursed now it likely will  require final decisions on the initial litigation and then a second litigation for a bad-faith insurance lawsuit to go through the Court systems.

Timeframe to Report Claims

Florida policyholders need to be mindful of this critical update. They now have less time to report a claim. 

Property damage insurance claims must now be filed within one year. The prior time frame was two years and previously three years. In addition, reopened claims for adding supplemental information are reduced as well.

Timeframe to Address Claims

Good news for the insured includes changes to payments due from the property insurance company. Let's look at a few of the changes that speed up the process and get the insured paid faster.

With the new insurance laws, claims must get paid or denied within 60 days of the filing of the claim by the insured or the insured’s attorney. The previous timeframe was 90 days.

The prior time frame was 14 days.

The insurer must also conduct an in-person inspection within 30 days instead of the previous 45 days. Property damage claims changes include all claims including storm, hurricane, lightning, fire,  water damage..

Maximize Your Insurance Benefits

The information provided isn't an all-inclusive list of recent changes to Florida property insurance. We realize that dealing with property insurance carriers is scary for Florida residents. 

That's why we're here to inform residents and business owners of changes to Florida property insurance laws.

Do you need help with a Florida property claim? Don't fear the insurance company. Schedule a consultation with the Knoerr Law Group, Today!