Florida’s legal reforms, designed to curb legal system abuse and claim fraud, are showing early signs of success, leading to a stabilization of home insurance rates in the Sunshine State, according to a study by the U.S. Chamber of Commerce Institute for Legal Reform, reported the Triple-I Blog.
The big picture: Despite the progress, a concern that opportunistic trial attorneys will generate frivolous lawsuits for profit remains.
- The 2025 legislative session is expected to introduce a bill requiring more transparency for third-party litigation funding, marking another crucial step in the reform of Florida’s legal system.
- The state’s ongoing reform effort underscores the broader need for insurers and businesses to adapt their risk management strategies in response to evolving legal landscapes.
Key reforms passed by state lawmakers and court rulings:
- Florida SB 2A (2022) eliminated one-way attorney fees, which curbed rampant legal system abuse by billboard attorneys; and prohibited assignment of benefits (AOB) for property insurance claims, halting fraudulent claim-filing by third parties, such as unscrupulous roofing contractors and unlicensed public adjusters.
- Florida HB 1205 (2023) prohibits misleading legal service ads and the misuse of consumer health information for legal services.
- Florida HB 837 (2023) adopted modified comparative fault, limiting plaintiff recovery over 50% fault, protecting multi-family owners from third-party crime liability, and restricting bad faith insurance claims.
- Florida Supreme Court Ruling (2024) requires discovery to be proportional to case needs.
What we’re saying: “Legislative reforms have vastly improved Florida’s property insurance market. They have led to a 35% year-over-year decline in property claim lawsuit filings, better loss ratios for insurers, a manageable 2024 hurricane season, billions in new capital, and a projected reduction in reinsurance costs for 2025 following flattened rates in 2024,” said Triple-I’s Mark Friedlander.
- He added, “Any efforts to roll back the reforms previously passed would have a negative impact on the market’s continued path toward stability.”
The takeaway: Florida’s legal reforms are yielding positive results for consumers, business owners and insurers, establishing a model for other states to address legal system abuse and help stabilize home, auto and commercial rates.
Go deeper: Read Triple-I’s Florida Issues Brief (members-only).
- Visit Triple-I’s Stop Legal System Abuse microsite.