What To Expect from New 2023 Property Insurance Legislation in Florida

State legislators introduce sweeping changes to the property insurance claims process.

Most homeowners in Florida already know that obtaining property insurance has been extremely challenging in recent years. More companies than ever have dropped coverage for property owners or have even closed their businesses altogether.
After Florida legislators convened for a special session on December 12th 2022, Senate bill 2A was passed—which makes changes to the property insurance claims process, regulation of insurance companies, reinsurance, and even more.
The changes come after state lawmakers and officials begin to acknowledge Florida’s property insurance crisis.

Why the changes were so necessary
Hurricanes that sweep across Florida every year cost billions of dollars in damages. However, they aren’t the only source of inspiration for making changes to property insurance laws. commercial rates were at a 20-year high, and Citizen’s Property Insurance Corporation (CPIC) became the number one source for homeowner insurance. This is especially cause for concern because the state-run agency is meant to be a last resort for homeowners’ insurance.
At least six different insurance carriers had to close up their businesses and leave the state and at least 27 additional carriers were downgraded severely. Previous regulations made it far too easy for attorneys to benefit from excessive insurance claims, creating an imbalance that ultimately is not sustainable.

What the new laws are going to do
The purpose of these new laws is to lay out improved requirements and expectations for property owners and insurance carriers.
In an effort to decrease frivolous litigation, property owners will be required to abide by new time frames and regulations. Nobody will be able to sue an insurer unless there is a clear bad faith breach of contract. Additionally, residents must provide notice of a loss to their insurer within one year—instead of two years—for initial claims or reopened claims. For supplemental claims, they will need to provide notice within 18 months instead of three years.
In order to make the insurance claim process more efficient insurance carriers will be held to a higher standard of investigating communicating and paying claims. to ensure transparency for the benefit of policyholders they must include the statement quotation flood coverage not included quotation on the policies declarations page. This will help prevent any policyholders from claiming that they did not miss this very important detail on their policy. Lastly, insurance carriers will be allowed to offer premium discounts to anyone who agrees to participate in arbitration rather than going to court to resolve a claim.

Final thoughts
This new legislation will have an effect on business owners as much as policyholders. While it is intended to make the entire property insurance process more manageable, it might be a little bit confusing at first. Contractors and anyone that works in a business that has to do with roofing or reconstructive services should make sure that they are still meeting state requirements. if you’re a homeowner and want to fully understand how these changes will affect you from 2023 onwards, contact your current insurance representative for a detailed breakdown.