A Florida law aimed at stabilizing the insurance market may have created an even worse situation for policyholders, leaving them with limited recourse as insurers keep them in limbo. 

What’s happening?

An investigation by WPTV revealed that insurance companies in the Sunshine State have been dragging their feet for months before addressing claims.

For Brittani Littlejohn, whose home was ravaged by an EF-3 tornado, that meant months of reaching out to her insurance company, only to be ghosted after filing a claim before WPTV’s investigative team stepped in.

Littlejohn isn’t alone in this experience. “We’re hearing these stories all the time of people who just feel completely ignored by their insurance companies,” said West Palm Beach insurance attorney Aaron Bass.

Attorney intervention often helps move the needle, but Bass explained that a 2022 Florida law preventing policyholders from recouping attorney fees has created a “lose-lose” situation for consumers making claims.

Jimmy Patronis, Florida’s chief financial officer, supported that assessment, telling WPTV that the state had seen abuse in the system, with “some attorneys claiming absolutely ludicrous fees.”

Why is this important? 

As insurers pull out or reduce coverage in many areas of the country, premiums are also increasing where they remain, making homeownership a distant dream for many and increasing the period of economic upheaval in communities recovering from natural disasters.

As the National Association of Insurance Commissioners explains, the exorbitant premium hikes are linked in part to more frequent and severe extreme weather. This is true even in places such as Iowa, not traditionally considered as high risk as states such as Florida, which deals with hurricanes.

“Insurance companies do not make money from your premium dollars,” Bass explained to WPTV. “They make money by taking your premium dollars and investing it. The longer they hold onto those dollars, the more money they make. The longer they can stretch these things out in litigation, that’s their tactic so that people just give up.”

What is being done about the insurance situation in Florida?

State officials have taken emergency action to help protect residents from post-storm insurance fraud. For example, before Hurricane Milton made landfall in October, they issued a decree requiring adjusters to provide line-by-line written breakdowns of estimated losses, helping ensure transparency in a system with strict regulations about changes to initial estimates.

More recently, when WPTV investigative reporter Kate Hussey asked Patronis if the insurance market could find a “middle ground,” Patronis conceded that 2022’s legislation may have been an “overcorrection of the system” and expressed optimism that there could be improvement.

He pointed to pending legislation that would mandate mediation between policyholders and property insurance companies for claim disputes before being eligible for court. This is meant to prevent clients from being left without answers for months on end.

If you want to make your voice heard on these matters, you can contact your representatives and raise awareness about the issue in conversations with family and friends.

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