Three weeks into the legislative session, Florida’s tort reform bill has passed in the House and Senate and now heads to the governor’s desk.
The bill, which will have a significant impact on the ability of everyday Floridians to file civil lawsuits, has garnered strong support as well as strong opposition from the community.
Due to constant changes and amendments, the full impact of the bill will not be known until it’s signed by Governor Ron DeSantis. Until then, here’s what we know about House Bill 837 and how it can impact you.
What is House Bill 837?
HB 837 is a lawsuit reform bill designed to protect businesses, property owners, and corporations from paying excessive damages in lawsuits.
“Under current law, fraudsters and con artists prey on small businesses by filing lawsuits when injured, even if they are up to 99% at fault,” according to a news release from the office of Gov. DeSantis.
However, this new bill will reduce these “frivolous” lawsuits by eliminating one-way attorney fees and attorney fee multipliers for all lines of insurance, among other reforms, according to the office of Gov. DeSantis.
However, opponents point out that the bill will also make it much more difficult for the average person to file a lawsuit when they feel they have been wronged by their insurance company.
The bill would also limit the amount of damages that can be sought by multiple plaintiffs and reduce the statute of limitations for negligence lawsuits.
HB 837 is a lawsuit reform bill designed to protect businesses, property owners, and corporations from paying excessive damages in lawsuits. NBC 6’s Yaima Crespo has more on the impacts.
Will this bill affect my day-to-day life?
The bill will not only impact businesses and the people looking to sue them. It will also impact the lives of everyday Floridians.
In terms of day-to-day safety, Todd Michaels of Haggard Law Firm says the bill takes away the incentive for private businesses to take the necessary steps to keep their customers safe.
“Every aspect of our lives that involves something going wrong, and needing your insurance company to be there for you, is being impaired,” he said.
When someone is the victim of a crime, Michaels says their ability to seek justice through the civil justice system is also being impacted by this bill.
For example, if someone is paralyzed in a criminal act on a property that has had repeated criminal activity, and steps have not been taken to make it safe, Michaels says this bill would make it much harder for that person to receive compensation for their medical needs.
“You are about to lose all of your leverage against your own insurance company — your health insurance, your life insurance,” said Michaels. “All of the leverage for them to do the right thing is taken away.”
What if I am wronged by my insurance company and want to sue?
HB 837 seeks to eliminate Florida’s current one-way attorney fee statute. This statute is intended to protect policyholders from legal bills when they need to sue their insurers — but how could this impact you?
In the context of life insurance, Michaels gives an example using a couple with young children. Say the husband, who has a $1 million life insurance policy, dies.
Michaels says that if the insurance company fails to pay the full $1 million that they owe the man’s widow, she can sue the insurance company, at which point, they would then have to pay the money they owe her, plus the attorney fees.
Insurance companies are incentivized to do the right thing and pay out the full $1 million to avoid being sued and having to pay attorney fees. By eliminating one-way attorney fees, the widow in this example would be responsible for paying the attorney fees out of her own pocket.
“The insurance company, which is a corporation with a fiduciary responsibility to its shareholders, will have not only the right but you could argue the duty to try to short their policyholders,” he says.
In this example, the insurance company would be incentivized to offer the widow less than $1 million, because they know the only way she could claim the rest of it is if she paid out of her own pocket.
Michaels says the same applies to other forms of insurance like health insurance.
“If someone is diagnosed with cancer, and their insurance company refused to pay for the treatment, they’re going to have to go into their own pocket to sue that insurance company,” said Michaels.
So what does this mean for the average person?
“The people that have the means to hire their own lawyer will get treated,” Michaels said. “And the people that don’t, will die.”
What is the controversy surrounding HB 837?
Back in February, the office of Gov. DeSantis called the bill “the most comprehensive reform in decades to decrease frivolous lawsuits and prevent predatory practices of trial attorneys that prey on hardworking Floridians.”
Advocates of the bill, like House Speaker Paul Renner, highlight the bill’s goal of restoring “balance” in Florida’s legal system and bringing transparency to the civil courtroom.
However, critics of the bill point out the large transfer of rights, money and power from individual Floridians to insurance companies.
Michaels says that the bill will give insurance companies protection to either underpay someone or not pay someone at all when something goes wrong.
In light of concern from the community about the bill, NBC 6 reached out to the Executive Office of Governor Ron DeSantis for comment.
“Since this legislation is still subject to the legislative process (and therefore different iterations), the governor will decide on the merits of the bill in final form if and when it passes and is delivered to the governor’s office,” said Deputy Press Secretary Jeremy T. Redfern.
Clinton Mora is a reporter for Trending Insurance News. He has previously worked for the Forbes. As a contributor to Trending Insurance News, Clinton covers emerging a wide range of property and casualty insurance related stories.