Florida Governor Ron DeSantis To Approve Package That Could Raise Property Insurance Rates – CBS Miami

Florida Governor Ron DeSantis To Approve Package That Could Raise Property Insurance Rates – CBS Miami

TALLAHASSEE (CBSMiami/NSF) — Gov. Ron DeSantis said Wednesday he will sign a property insurance package that could lead to larger rate increases for customers of the state-backed Citizens Property Insurance Corp. while seeking to curb roof-damage claims and lawsuits.

But he added more will need to be done to make the private insurance industry “stronger.”

“I think we got a lot of good stuff done in the legislative session, one of the things we’ll be, I know we worked on, was some property insurance reform, to try to stem some of the problems we see in that market,” DeSantis said, while appearing by video during a meeting of the Enterprise Florida Board of Directors. “We want this to be affordable for homeowners. We don’t want it to be something that is just kind of a pot for litigation. And that really (is) what was happening in Florida. I mean a huge, huge proportion of the money was going to litigation expenses.”

The heavily negotiated bill (SB 76), which passed the Legislature in April, drew criticism from some lawmakers for going too far, while others argued it didn’t go far enough.

The bill was one of five sent to DeSantis’ desk on Wednesday. He has 15 days to act on the bills.

Senate Banking and Insurance Chairman Jim Boyd, R-Bradenton, said everybody “had to give a little bit” in negotiations on the bill, which is intended to bolster an insurance market that has seen wide-ranging rate increases and policies pouring into Citizens.

“I do believe it will help the market kind of rebuild itself,” Boyd, the bill sponsor, said when the measure was approved by the Senate on April 30, the last day of the 60-day session.

The bill came against the backdrop of regulators last year signing off on dozens of rate increases topping 10 percent. Also, private companies have dropped tens of thousands of policies because of financial issues. Citizens, which was created as an insurer of last resort, saw its policy count grow to 589,041 as of April 30, up from 453,911 a year earlier.

DeSantis told Enterprise Florida board members, who met at Embry-Riddle Aeronautical University in Daytona Beach, that the goal is “manageable premiums” and a “stronger private insurance market,” where payments go “to the actual claimants rather than to the attorneys.”

He added that changes will continue to be an issue in future legislative sessions.

“It’s something that we’re working on, and we’re watching very closely,” DeSantis added. “But I think the Legislature did, by and large, a pretty good job on addressing it. But we’re probably going to have to do more going forward.”

In arguing against the bill on the Senate floor, Sen. Annette Taddeo, D-Miami, complained the measure “literally is going to raise the rates” for Citizens customers.

However, Citizens President and CEO Barry Gilway issued a statement when the bill was approved that said the measure offers “meaningful steps to address rising insurance rates caused in large part by unnecessary litigation.”

“Citizens is growing at an unsustainable rate, putting our customers and Floridians on the financial hook when a big storm hits the state,” Gilway said in the statement.

Sen. Gary Farmer, a Lighthouse Point Democrat who was one of five senators who opposed the changes, likened the insurance industry to “Chicken Little” and disputed arguments about major financial problems among insurers.

“It’s a manufactured crisis — a completely manufactured crisis,” Farmer said.

Among the changes in the bill, which will take effect July 1:

— Allowing larger annual rate increases for customers of Citizens. Such increases currently are capped at 10 percent, but that limit would be gradually raised to 15 percent.

— Preventing contractors from soliciting homeowners to file insurance claims, including offering incentives to homeowners. That part of the bill is intended to curb roof-damage claims. It also seeks to prevent public insurance adjusters from offering incentives to inspect for roof damage.

— Taking steps to try to limit fees of attorneys who represent homeowners in lawsuits against insurers. That involves using a formula that would look at how much money is awarded in court judgments and how much money was offered by insurers to settle claims before the lawsuits.

— Reducing from three years to two years the time to file claims, with an additional year for supplemental claims.

The Senate initially sought more far-reaching changes to attorney fees and roof-damage claims. In part, it proposed creating a “reimbursement schedule” that would have allowed insurers to sell policies that provide reduced payments for repairing or replacing roofs over 10 years old. For example, insurers could have reimbursed 70 percent of the costs for metal roofs over 10 years old and 40 percent of the costs for concrete-tile and clay-tile roofs.

The change would have led to shifting more costs to many homeowners when they have roof damage. But the House balked at the idea, which was not included in the final bill.

(©2021 CBS Local Media. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. The News Service of Florida’s Jim Turner contributed to this report.)

This content was originally published here.

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