Florida's Insurance Market Faces Challenges and Changes

In recent years, Florida insurance industry has experienced a significant decrease in litigation and insurance premiums, mainly attributed to legal reforms such as House Bill 837, which eliminated 'one-way fees.' These fees previously allowed attorneys to file numerous meritless lawsuits without financial risk, fostering what was termed 'spaghetti litigation.'

The bill's passage has not only reduced litigation by approximately 30% from past peak levels, but also encouraged the entry of 12 new property insurance companies into the state and led to nearly 100 insurers filing for lower or unchanged rates. However, the proposed House Bill 1551 threatens to reverse these gains by reintroducing mandatory attorney fees, potentially increasing premiums and diminishing market competition.

Such a change could deter carriers and reinsurers, impacting the stability of Florida's insurance market and burdening homeowners with increased costs.