After latest insurance reforms, what rights do policyholders have left?

The state Legislature has agreed to end the property insurance industry in Florida. It is now claiming that the reforms will stabilize the market and reduce premiums. But advocates for policyholders claim that homeowners are paying a high price. They claim that policyholders are losing the leverage they used to force insurers into fair settlements. Paul Handerhan, president and CEO of the Federal Association for Insurance Reform (a consumer-oriented watchdog organization), said that reforms will likely achieve insurers' goals to reduce litigation. He said that he expects to see many attorneys leave the market because it will be harder for them to obtain attorneys fees, and the fees when they do will be lower. "Industry advocates" claim that the reforms simply move property insurance disputes on the same level as personal injury lawsuits stemming out of auto accidents. According to Stacey Giulianti (chief legal officer at Florida Peninsula Insurance Co., Boca Raton), "There are thousands" of lawyers who will take these cases. [ RELATED: Fixing Florida’s insurance woes. Here's what lawmakers' session will address next week.] In Florida, the insurers claim that the increased number of cases and higher fees has rendered the insurance industry in Florida unprofitable.
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The availability of property insurance is essential for homeowners who have mortgage loans. This is because insurance is necessary for them to be able to challenge insurance claims denials or inadequate settlement offers. The law allows policyholders the ability to challenge denials of insurance claims or insufficient settlement offers. However, it does not require policyholders pay the legal fees for a lawsuit. Instead, they will need to pay an attorney upfront or find one willing and able to take on a contingency basis. This means that the client won't be paid unless the case is successful. The typical amount of attorney payment is between 33.5% to 40% of the final award or settlement. Joe Ligman, a Palmetto Bay-based plaintiff's lawyer, said that he would be less likely take cases with claims less than $100,000 and not have the right to collect legal fees from the insurance company. I understand that $50,000 in loss for someone earning $30,000 to $50,000 can be a significant amount of money.
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How do you litigate this and charge 35% to 40 percent of the recovery? That case is too difficult for me. Giulianti claims that there will always be an abundance of lawyers willing to represent homeowners on a contingent basis. [ RELATED : Ian has made it clear that we will all be paying more for insurance next year.] "Just like in any other auto accident, tort or collection case, the attorney collects an amount of any recovery," he stated. They only pay out of any recovery -- there is no recovery and no fee. Giulianti stated that policyholders may see quicker results in smaller cases handled on contingency. This is because the attorney does not have the incentive to keep the clock ticking over for many years without a large one-way fee payout. A 'civil offer to judgment' is the last way that policyholders can get attorneys fees and not lose a portion of their claim payment. A civil offer of judgment is a process that allows policyholders to collect attorney fees without losing a percentage of their claim payment. In order to avoid litigation, insurers can require policyholders to agree to binding arbitration.
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This is an alternative dispute resolution option available alongside mediation or appraisal. Homeowners who agree policies with arbitration clauses receive a premium discount, but they lose the ability to sue their insurer. Jim Boyd, a Tampa Bay Republican, sponsored the Senate reform bill. He stated that policyholders could enter into arbitration without the need to hire an attorney. [ RELATED : Citizens Insurance wants rate increases to be enacted next week in the special legislative session.] However, Amy Boggs (chairwoman of the personal injuries section of Florida Justice Association), a lobbying group representing plaintiffs lawyers, believes that this is not possible. "How can you go to arbitration without an lawyer?" She asked
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"Doesn’t the rule apply to evidence?" Do insurance companies file motions that are beyond the reach of a normal person? She says that homeowners who choose arbitration will be responsible for paying for expert witnesses, attorneys and fees for the panel of arbitrators. This is because they are unable to recover money they have earned if they win. She stated that insurance companies are frequent users of the process, and arbitrators cannot [make them mad] or they won’t be appointed and paid fees. The decisions are made behind closed doors, often without any record.
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Arbitration can be as costly as litigation, but it does not offer consumer protections or a way to make the policyholder whole. Boggs recommends homeowners take time to consider whether they are willing to agree to an arbitration clause in their policy. It is unlikely that homeowners will be able to get a modest discount by agreeing to a binding arbitration clause in their insurance policy. Insurers could also be sued for failing to perform their duties in good faith. The revised law allows for a court to find that an insurer has violated the policyholder's contract. This means that a case cannot be filed unless the modifications are made.
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Reinsurers, which are insurance companies that provide insurance to insurers to cover all claims following a catastrophe, have been signaling a willingness to stop providing coverage in Florida at affordable rates. This is despite the fact that policyholders didn't agree to it but must accept it to maintain insurance availability -- hopefully from more companies that offer lower rates. He stated that policyholders are losing their leverage. He said that policyholders are losing leverage. However, insurers must be aware of the fact that failing to do everything possible to be fair to policyholders could lead to backlash and force future legislatures into reconsidering the reforms. The Legislature increased the requirements for claims handling for insurers. Instead of 90 days, insurers now have to respond to claims in 60 days. The Florida Office of Insurance Regulation can extend the 60 day deadline to 90 days if there is a state of emergency or cyberattack that prevents an insurer from fulfilling the 90-day requirement.
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This applies to hurricane claims. You can reach him by phone at 954-356-4071 or via Twitter @URL_, or email at EMAIL.