Florida Insurers Blame Surging Rates on Roofing Claims

PALM BAY, Florida – Ronald Twing says retiring to Florida was always planned.

“This has probably been a dream of ours since our 40s. We moved to Florida, ”said Twing.

What you need to know

  • Insurance Information Institute: Lawsuits filed in Florida against insurers are expected to rise to 150,000 by 2020
  • Experts blame roof claims that lead people to replace entire roofs
  • State lawmakers are examining tort law reform to address the problem

That dream came true after Twing and his wife bought a home in Palm Bay, but it was a dream that came at an unexpected cost when he received his last homeowner’s insurance premium estimate.

“I was amazed and frustrated. I think how can you justify a 115% increase in a policy? “Said Twing.

Twing is far from the only homeowner with sticker shock.

“We are seeing door-to-door inquiries from homeowners across Florida, particularly central Florida. It has been widespread in recent years. This leads to an increase in claims and litigation in disputes between the contractor and the insurance company, ”said Mark Friedlander, communications director for the Insurance Information Institute.

According to Frielander, these contractors or roofers promise to help homeowners get new roofs at the price of their deductible. When they get on the roof they may find some problems but then claim the entire roof needs to be replaced.

Frielander says this is legal for legal reasons.

According to the Insurance Information Institute, 45,000 lawsuits were filed against insurers in Florida in 2018. This number is expected to increase to 150,000 in 2020 and to over 200,000 in 2021.

“You have insurers who are going under financially. We are talking about underwriting losses of well over $ 1 billion for insurers that buy policies primarily in Florida, ”Friedlander said.

Florida MP Anthony Sabatini, R-Howey-in-the-Hills, points out two other issues: Under current law, Florida homeowners have three years to file a lawsuit. And then there is what is known as a contingent fee multiplier, which a Florida attorney can use to get three times his regular fee in such cases.

“It all goes into the law firm’s pocket. That doesn’t go to the owner. It all goes to the lawyers, ”said Sabatini.

Amy Boggs, who is also the chair of the Florida Justice Association’s property insurance division, sees things differently. She believes that the focus should be on roofers involved in fraudulent claims.

“Bring these cases to justice. Are you cheating? Large. Get a zero judgment. Get a few of those and the lawyers who are doing that will stop, ”Boggs said.

Three bills due to be introduced during the upcoming Florida legislature are designed to address these issues: HB 305, SB 212 and SB 76, which will reform legal fees in property insurance cases.

“I think you will see double-digit rating increases until we pass massive crime reform in the state,” said Sabatini.

According to data from Spectrum News obtained from the Florida Office of Insurance Regulation, insurance companies called for dozens of double-digit increases in the first nine months of 2020, many of which were state-approved.

A FOIR spokesperson said litigation and more hurricane-related claims are driving premiums up, and told Spectrum News in an email, “The Florida insurance market is one of the most complex in the world.”

At Ana Regina Myrrha’s insurance agency, due to double-digit increases, she hired an additional employee to serve clients looking for lower premiums.

“It’s like a perfect storm. Everyone is going through financial situations and now you are too, ”Myrrha said.

When asked if it might be helpful to limit how much insurance companies can raise premiums, Friedlander said that while it sounds good, it is not that easy.

“It is reaching a point where insurers can default. You will just go out of business. And that will do further damage to Florida property owners as they now have less choice, “Friedlander said.

It is one way that Ronald Twing is hoping lawmakers and the insurance industry can work together to avoid this.

“I worry about the people who find themselves in a situation that cannot afford it. What will happen to these people? “Asked Twing.

VIDEO: What to do about higher home insurance premiums?

So what can you do when you’ve received a much higher premium?

Spectum News asked Ana Regina Myrrha this question in the following video clip.

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