Who really benefits from insurance law? – InsuranceNewsNet

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While the law provides for a rate reduction for consumers… it appears that insurance companies are free to determine the amount themselves. There is no monitoring mechanism or sanction in case of non-compliance.

Govt. Ron DeSantis recently signed Senate Bill 2-D into law and in doing so gave the insurance industry a generous advantage at the expense of Florida owners.

The law is essentially another level of reassurance — it’s a $2 billion funds (plus additional funds from the general budget if the governor wishes) that insurance companies can draw on free of charge.

The law expressly states that no premium will be charged to insurance companies for their participation in the program. The law also specifies that insurance companies can draw from the fund without any compensation for reimbursements they may have received from other sources of reinsurance. It provides for 100% reimbursement (90% of losses plus 10% for “claims settlement expenses”) to insurance companies, which is funded by taxpayers’ money.

The law also provides rule-making power and specifically states that no finding is required for rules deemed to be enacted on an emergency basis.

The regulatory authority created is specifically exempt from Florida Statute 120.54, which requires single subject rules, public notice, public rulemaking workshops, and notice of estimated regulatory costs, to name a few. Highlights.

None of these procedural safeguards are required for the rules promulgated under the new law.

Although the law provides for a rate reduction for consumers, which must be proportional to the cost savings realized by the companies participating in the program, it seems that the insurance companies are free to determine the amount themselves. There is no monitoring mechanism or sanction in case of non-compliance.

The law also makes it more difficult to maintain a lawsuit against an insurance company.

Florida statute 624.155 allowed, among other things, lawsuits against insurance companies based on bad faith, but the new law removes that and now requires plaintiffs to specifically prove a breach of contract.

While refusing to pay a valid claim for years and years isn’t actually a breach of contract, it certainly could be bad faith, but Floridians no longer have that option available.

You can also expect to see a separate roof deductible added to policies at the next renewal, which means more payouts for claims that include roof damage.

Finally, the law creates a new way for insurance companies to collect legal fees from the insured when cases are dismissed, and removes a way for the insured to collect legal fees from insurance companies.

Lawyers are more likely to accept clients whose claims include favorable fee transfer provisions, meaning fewer lawyers may be inclined to represent policyholders in policy disputes.

Florida needed a little relief, but that’s definitely not it. This new law supports private companies with taxpayers’ money and further skews an already uneven playing field in favor of big insurance.

Adam Ellis is a civil lawyer at Tallahassee focused on employee rights.

Your turn

Adam Ellis

Guest columnist

While the law provides for a rate reduction for consumers… it appears that insurance companies are free to determine the amount themselves. There is no monitoring mechanism or sanction in case of non-compliance.


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