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Florida leaders try to tame soaring property-insurance premiums with reform bill


TALLAHASSEE — Grappling with problems in the property insurance market, Florida lawmakers have passed a plan that could lead to larger rate increases for customers of the state-backed Citizens Property Insurance Corp. and steps to curb roof damage claims and lawsuits.

But the bill approved on the last day of the regular session on Friday was not as far-reaching as a Senate proposal that would have effectively shifted more costs to many homeowners when they suffer roof damage.

The Senate voted 35-5 to approve the measure, and the House followed with a 75-41 vote. The bill now goes to Gov. Ron DeSantis.

Senate Banking and Insurance Chairman Jim Boyd, R-Bradenton, said everybody “had to give a little bit” in negotiations over the bill (SB 76). But he said it would bolster an insurance market that has seen wide-ranging rate increases and policies pouring into Citizens Property Insurance.

“I do believe it will help the market kind of rebuild itself,” said Boyd, the bill sponsor.

The bill, however, drew criticism from some lawmakers who said it went too far and others who said it didn’t go far enough. Sen. Annette Taddeo, D-Miami, complained about the prospect of increased rate hikes for Citizens customers.

“There is no sugar-coating this,” Taddeo said. “It literally is going to raise the rates.”

But Sen. Jeff Brandes, R-St. Petersburg, said the bill will not fix financial problems in the insurance market.

“We are on an unsustainable trajectory,” Brandes said. “This bill is 40 percent of what it needed to be.”

The bill came against the backdrop of regulators last year signing off on dozens of rate increases topping 10% and more. Also, as the insurance market has tightened, Citizens has gained more than 120,000 policies during the past year.

The insurance industry points to problems such as litigation costs and questionable, if not fraudulent, roof damage claims. Also, officials argue that Citizens, which was created as an insurer of last resort, often charges lower premiums than private insurers.

Lawmakers such as Brandes argue that growth in Citizens poses a major financial risk to the state. But the issue of raising Citizens’ rates is tricky politically because homeowners in some areas have few or no other options for coverage.

The bill would make a series of changes. They include:

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

– 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.

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