Highlights: The American Policy Holders Assoc. Investigation of Florida Homeowners Insurance Market
At Warner & Fitzmartin, we want to inform you about the significant findings from the American Policy Holders Association’s (APHA) recent investigation into Florida's homeowners insurance market. Over the past five to ten years, Florida has seen a troubling trend where major insurance companies have either declared insolvency or exited the state entirely.
Background:
The Office of Insurance Regulation (OIR) in Florida is tasked with overseeing insurance activities and preventing bad practices. However, concerns have been raised about the reliability of the reports OIR relies on, particularly because some reports were prepared by entities with potential conflicts of interest. These reports have influenced major legislative changes in Florida’s property insurance landscape, often to the detriment of consumers.
Key Findings:
- CEO Bonuses Preceding Insolvency: Several now-insolvent Florida insurance companies awarded their CEOs significant bonuses right before declaring bankruptcy. This left many Florida homeowners uninsured and scrambling for coverage.
- High Consumer Complaints: Florida leads the nation in consumer complaints against insurance companies. The companies with the highest number of complaints were also the ones paying out the most to their executives.
- Misleading Blame on Litigation: The OIR and insurance companies have often blamed litigation for the high premiums and insolvency issues. However, the APHA report reveals that litigation is only a minor factor. The financial records of companies like United Property and Casualty Insurance Company indicate that other issues are at play.
Implications:
The APHA report highlights the need for a thorough review of Florida’s insurance market regulations. The investigation debunks the narrative that frivolous litigation is the primary cause of market instability. Instead, it points to deeper issues within the insurance companies themselves and the regulatory framework.
Next Steps:
If you have questions about your homeowner's insurance, have filed a consumer complaint, or are considering doing so, contact the attorneys at Warner & Fitzmartin. We’re here to help you navigate these complex issues and ensure your rights are protected. If you have questions or want to review the report, contact us today.