During a special session of the Florida Legislature that convened on December 12, 2022, sweeping changes to property insurance were approved, including the enactment of Senate Bill 2A. Despite the timing amid the holiday season, these changes hold substantial implications for property insurance claims, reinsurance, and the regulations governing insurance companies. This summary, drawn from information provided by the Florida Legislature, highlights key aspects of Senate Bill 2A. For a comprehensive review of the bill, please visit Florida Senate Bill 2A.
Florida Optional Reinsurance Assistance Program
Introduces the Florida Optional Reinsurance Assistance (FORA) Program for the 2023 hurricane season.
Provides insurance companies with the option of obtaining hurricane reinsurance at reasonable/near-market rates.
Aims to mitigate premium increases by offering lower reinsurance rates through the program.
Claim Filing Deadline
Reduces the deadline for policyholders to report new or reopened claims from 2 years to 1 year and supplemental claims from 3 years to 18 months.
Addresses concerns related to potential fraudulent claims filed closer to the deadline.
Prompt Pay Laws for Property Insurance
Amends prompt pay laws to expedite claims processing:
Reduces the time for companies to pay or deny a claim from 90 to 60 days.
Allows the Florida Office of Insurance Regulation (OIR) to extend the period by 30 days under specific circumstances.
Shortens the time for reviewing and acknowledging a claim communication, initiating an investigation, and conducting a physical inspection.
Permits electronic methods for damage assessment, ensuring policyholder participation.
Mandates the timely provision of the adjuster’s damage estimate to the policyholder.
Awards of Attorney Fees in Property Insurance Lawsuits
Repeals one-way attorney fee provisions related to property insurance claims.
Neither party can be awarded attorney fees in property insurance claims lawsuits, with each party responsible for their fees.
Assignments of Benefits
Prohibits the assignment, in whole or in part, of post-loss insurance benefits under residential or commercial property insurance policies issued on or after January 1, 2023.
Regulation of Insurance in Florida by the OIR
Enhances the OIR’s ability to conduct market conduct exams of property insurance companies post-hurricane.
Appropriates funds for OIR staff salaries, recruitment, and retention efforts.
Empowers the OIR to discipline companies for appraisal process abuse and extend coverage periods for insolvent companies.
Bad Faith Failure to Settle Actions
Requires a court finding of a breach of contract before suing a property insurance company for bad faith.
Acceptance of an offer of judgment or an appraisal award alone is insufficient for a lawsuit.
Citizens Property Insurance Corporation (Citizens)
Policyholders ineligible for Citizens if receiving offers within 20% of their Citizens premium.
Requires flood insurance for Citizens residential policyholders.
Sets rate limitations for non-primary residences policies.
Flood Notice
Requires the inclusion of a flood notice on insurance policy declarations pages, encouraging policyholders to purchase flood insurance.
Arbitration
Specifies conditions for insurance companies issuing optional endorsements related to mandatory arbitration.
Premium discounts are mandated for policies with mandatory arbitration.
Disclaimer: This information is provided for informational purposes only. For accurate and specific details, it is recommended to refer to the official source at My CFO Florida or contact Experienced Public Adjusters directly.