As insurers process claims from Hurricane Irma, they say it’s more urgent than ever to change state laws to curb what they call abuses by some attorneys and contractors handling claims.
“The lawyers are getting rich,” said Barry Gilway, CEO of state-run Citizens Property Insurance Corp., told the Florida Chamber Insurance Summit Thursday. That’s driving up consumer rates, he said.
Florida insurance commissioner David Altmaier said about 90 percent of property insurers are seeking premium increases in rate filings, compared to less than half three years ago.
But breaking a years-long legislative stalemate in Tallahassee might require taking a deep breath first, a state lawmaker said.
“I would like to hit the reset button,” said state Sen. Dorothy Hukill, R-Port Orange. That can mean “assume positive motives” by opponents, she said.
Organizers of the Orlando conference said state Sen. Anitere Flores, R-Miami, was expected to join a panel of lawmakers on the summit’s closing day Friday.
Last spring Flores accused insurers of “smearing” her because her committee did not advance legislation they wanted, including changes to state law governing fees attorneys can collect.
A key point of conflict is “assignment of benefits,” when contractors ask consumers to sign over control of insurance benefits before they clean up, say, water from a plumbing leak. Insurers and others also mentioned car windshield cases Thursday. When attorneys get involved by representing the contractors, costs can soar because many abuse rules such as the state’s “one way” attorney fee statute designed to protect little-guy consumers in fights with big companies, the argument goes.
In contrast, contractors have noted assignment of benefits is commonplace with medical providers, for example. Attorney Lee Jacobson said at a forum in Boca Raton last year that insurers are “crying wolf” in a bid to force rules changes that limit consumer rights and bolster company profits.
Such claims occur every year even without hurricanes, but insurers are closely watching what role AOB may play in the market after Irma. Nearly 800,000 Irma claims have been filed worth more than $5.5 billion, state records show.
Slightly less than half of Irma claims have been closed in Florida and in Palm Beach County. About 40 percent of closed claims statewide, and close to half in the county, have been resolved without payment, records show. That can reflect rising hurricane deductibles up to 10 percent of a home’s value — meaning claims did not exceed the amount the consumer pays before insurance kicks in — or other outcomes including claim denials.