•  Insurers will now be permitted to pass along the costs of reinsurance to its policyholders to the tune of a 15% maximum allowable rate hike YEARLY.  Basically, this means that your property insurance premium could DOUBLE within 5 years. 
•  The Statute of Limitations for filing lawsuits on all property insurance claims is now 5 years from the date of the loss.  Formerly the law provided that the Statute ran from the date of the breach of the insurance contract. 
•   The time deadline for an insured to report a new or re-opened (ie. Supplemental) hurricane claim is now 3 years.  Formerly insureds had 5 years to report a claim.  The time limit for sinkhole claims is 2 years now. 
• Allows insurers to hold back payments for home damages until after the work is performed or actual expenses are incurred by the insured.  Insurers will need to provide a written contract for work to be performed in order to release monies being held back.  This prevents insureds from making claims for damages to the property and then failing to perform the work paid for. 
• Limits public adjusters on Citizens Property Insurance claims to a fee of 10% of any all monies obtained for the insured above and beyond that already offered by Citizens.  Essentially, public adjusters are limited to 10% on re-opened/supplemental Citizens claims.  This will make it considerably more difficult for Citizens insureds to obtain assistance to contest under-evaluated claims.
•  Forces public adjusters to provide insurers with a copy of their contract with a policyholder upon request by the insurer.

So, in summary, the law basically provides higher rates, more restrictions on claims, stricter deadlines for the presentation of claims, and limitations on public adjusters.  It shouldn’t come as any surprise that nowhere in the body of this statute is there any language that provides any protections or rights to policyholders.  But that shouldn’t really be much of a shock to any of us who followed the election campaign of Governor Scott. 

Interestingly enough, Governor Scott has been ripped by several Florida newspapers in the aftermath of his first legislative session.  In addition, Governor Scott’s approval rating has plummeted to 29%, which is amazing considering he has only been in office 5 months.  I wonder how many people who voted for him back in November would like to re-cast those ballots today….

In the last few days, the Miami Herald has chimed in with an editorial urging the legislature NOT to pass any of the pending bills, citing the financial strain it would place on an already struggling population of Florida homeowners. You can read the editorial here:   http://www.miamiherald.com/2011/04/21/2179551/legislature-should-hold-the-line.html

The St. Petersburg Times has also joined in the fight by emphasizing that in a time of economic strife for many Floridians, the property insurance industry has reported earnings of $34.7 billion in 2010, which is a 21% increase from the previous year. Why is this significant? Because this past Sunday an investigative report by the Sarasota Herald Tribune’s Paige St. John shows that Governor Scott’s intention all along is to phase out Citizens Property Insurance in its entirety by the end of his first term. This would essentially force the 1.3 million Floridians who are insured by the ‘insurer of last resort’ back into an unregulated free market where the insurance rates would be completely unchecked and the benefits would be unguaranteed by the State of Florida unlike they currently are with Citizens.  The biggest problem with this initiative? The fact that Governor Scott is seemingly unconcerned that the private insurance market has already informed him that it is unable and unwilling to absorb Citizens’ policies. You can read the investigative report here:  http://www.heraldtribune.com/article/20110425/ARTICLE/304259999/2416/NEWS?p=1&tc=pg

The result of all of this has been proposed legislation that is intended to be the first step in a longer process of eventually squeezing insureds out of Citizens and gradually forcing them into the private market. However, this is being done without any safeguards for the premiums being charged by those who would fill Citizens’ shoes as well as a coordinated stripping down of the consumer protections provided by policyholders in the bad faith statute. What the Sarasota Herald Tribune article points out is that all of the pending legislation was essentially written by lobbyists and advocates of the insurance industry. So in a nutshell, the basic goal is to force policyholders away from Citizens while making Florida a more lucrative proposition for private insurers.

But here’s the thing, Citizens made $813 million last year and has built itself a $5.1 billion surplus. So why is there such urgency to shut it down? Several media outlets are asking those same questions. See:  http://fcir.org/2011/04/25/scotts-devious-plans-for-citizens/ and  http://www.floridatoday.com/article/20110424/COLUMNISTS0207/104240328/Matt-Reed-Lies-about-Citizens-justify-policyholder-abuse

The end result becomes the return of under-capitalized private insurers offering less coverage at dramatically higher rates.  With no guarantees that after a storm, those carriers will be able to pay their insureds’ claims.  We’ll be in the same boat we were in when Citizens was created in the first place.  This is what happens when you allow the insurance industry to write its own laws.  While I can’t say who wins in that scenario, I think its very clear who loses…..

Unfortunately for us, the Florida Peninsula just sticks out like a sore thumb into the hurricane danger zone. So whether or not the forecast is for alot of storms to recurve into the Atlantic or push through into the Gulf, the basic jist is that Florida always gets in the way!

This year, the weakening of the ongoing La Nina conditions (colder waters in the Pacific) as well as the related forecast position of the Bermuda high pressure (for you history buffs, that’s the big blob that sat on top of Hurricane Andrew in 1992 and refused to let it turn, sending it due West) portends a relatively busy season for South Florida.  The forecast is for 15 storms, which is less than last year. But if you recall, last year brought 19 storms but with little to no impact on the U.S. This year could produce alot more gnashing of teeth than 2010. Accuweather seems to feel that early in the season, Texas and the deep Carribean could be affected, with impacts in the Florida/Carolinas starting in mid to late season. That means as usual, August and September will require constant monitoring of the wave train.

Anyways, here is a link to their official forecast if you want to read more. http://www.accuweather.com/blogs/news/story/47289/2011-atlantic-hurricane-season.asp   But I have a feeling we’ll be seeing alot more of these types of reports in the next few months…

Several bills are floating around the Florida legislature which deregulate the insurance industry in Florida or strip away vital rights held by insureds in disputes with their insurance carriers. The legislative session launched earlier this month with bills which allowed Citizens to raise its rates by as much as 25% each year, prohibited Citizens insureds from retaining a public adjuster to assist in the handling of their claim, and rewording the consumer protections contained within the bad faith statute.  The most offensive bills so far are SB408, SB 1462, SB 1592, SB 1330 and SB 1714. You can track the progress of these bills and see the text of them here:  http://www.flsenate.gov/session/bills

What has been most notable about this legislative session so far is that the insurance industry has chosen to take on public adjusters as a whole as a means to control what the industry deems to be rampant fraud and misrepresented claims. Curiously, coinciding with the introduction of these bills, a high profile arrest was made in order to support the industry’s position. Considering that Citizens is seeking to ban its insureds from hiring a public adjuster, the timing is awfully convenient. Here is a link to the article….  http://articles.sun-sentinel.com/2011-03-10/business/sfl-public-adjuster-arrested-insurance-fraud-link-031011_1_public-adjuster-insurance-fraud-policyholders-in-claims-disputes

Needless to say, these bills bear watching as they progress through their respective committees. There are a number of pro-consumer legislators (Most notably Representative Rick Kriseman, Senator Mike Fasano, and Representative Carlos Trujillo) who have been actively trying to alert the public of the threat to consumers that this proposed legislation would pose. Here is a link to a St. Petersburg Times article which discusses their efforts and their specific complaints about the bills which are currently pending:  http://www.tampabay.com/news/politics/stateroundup/fasano-kriseman-outraged-over-bills-that-deregulate-florida-insurance/1158964  

This entire situation bears watching as the passage of any of these bills could change the landscape of the property insurance industry and could significantly impact the duties and obligations of insurers and their insureds alike. So stay tuned!

Fast forward to today and it’s no small wonder that even though I became a lawyer I ended up finding my way into an area of the law that deals with windstorms. Being an attorney who specializes in hurricane claims, naturally I spend alot of time looking at the tropics. And right now what I see is trouble….

The wave train has begun to churn on the tracks in the Atlantic. Many started to naysay the prognosticators who were calling for an extremely active storm season. However, it looks like ultimately the forecasters will be proven right after a slow start. The introduction of cooler air into Canada and the Northeast has fueled the tropics and lit the spark for the season. I would not be surprised to see relentless activity for the next 45 days or so.

So what does that mean? If you stopped paying attention after the slow start, its time to pick your head up again. Review those insurance policies and make sure all of your hurricane preparedness is in tip-top shape. We could be in for a bumpy ride yet….

One related point…. Over the years I have found that blogs and Twitter have become great resources for tracking storms. Tweets give you the basics so you can keep up during a busy day and the best bloggers out there will take the models and the data and bouil them down so you can understand what’s really going on with the storm tracks and intensity forecasts. Check out the blogs of Joe Bastardi and Max Mayfield for starters. Also the Twitter feed of Ken Kaye from the Fort Lauderdale Sun-Sentinel is a solid source of weather related news.

As a means of introduction, my name is Scott Kandell and I am an attorney here in Miami practicing in the area of insurance litigation as well as personal injury law. Over the past several years, I have developed a specialty in commerical insurance claims litigation in the wake of the hyperactive storm seasons of 2004 and 2005. Our firm works in conjunction with public adjusters to help insureds get compensated fairly for their windstorm, water damage or fire loss property claims and business interruption claims. We are often brought into a claim by public adjusters who are unable to get a claim paid but also we can be retained at the outset of a claim where we can ‘quarterback’ the process from day 1 and work in partnership with some of the best public adjusters in the industry.

I hope to provide useful information about preparing for hurricane losses and the state of the laws in Florida regarding these claims. If anyone ever has questions and wants to email me, they can at Scott@Kandelllaw.com. Thanks for reading!