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Property insurance reform backers see new attorney fee rules as far-reaching


By Michael Carroll | Jun 18, 2021

William Large

William Large, president of the Florida Justice Reform Institute, says the property insurance reforms will create sensible attorney fee rules. | Florida Justice Reform Institute

Florida’s property insurance market should stabilize in the wake of recent double-digit rate hikes as a reform bill’s new rules governing attorney fees take effect, according to those familiar with the reforms.

Gov. Ron DeSantis signed Senate Bill 76 into law earlier this month, putting in place new guard rails on the filing of property insurance lawsuits and restrictions on roofing contractor behavior. Under provisions of the new law, those planning to file property insurance lawsuits must give 10 business days notice prior to the filing, allowing insurers more time to find a path to settle disputes.

The bill will also bar contractors and public adjusters from using advertisements that encourage consumers to contact them in order to file property insurance claims for roof damage, and it creates new rules governing when insurers have to pay claimants’ insurance fees.

Under the reforms, when the amount won by the claimant above the presuit settlement offer is 50 percent or more of the disputed amount, the insurer has to pay all of the claimant’s attorney fees. If the difference is between at least 20 percent but less than 50 percent of the disputed amount, the insurer will be required to pay only a portion of the claimant’s lawyer fees – one equaling the percentage of the disputed amount.

And a difference of 20 percent or less would mean that each side would pay its own attorney fees, under the terms of SB 76.

“SB 76 is a revolutionary piece of legislation,” William Large, president of the Florida Justice Reform Institute, said in an email to the Florida Record. “Gov. DeSantis drew inspiration from Texas and adopted an attorney fee schedule that gets rid of the pernicious one-way attorneys’ fee schedule that allowed for fees, even if the plaintiff’s attorney collected a low dollar amount.

“Now, there will finally be a rational relationship between attorney fees and the amount recovered. Gov. DeSantis was able to accomplish something no previous governor has been able to do.” 

Rep. Bob Rommel (R-Naples), who helped to craft the legislation, said the reforms would help the insurance industry emerge from a crisis created by bad actors and destructive weather events.

“Over the past seven years, insurance companies have paid out over $15 billion in claims, out of which over $10 billion went to attorneys’ fees,” Rommel said in a prepared statement. “SB 76 is a big step toward stopping the abusive practices of these few bad actors, where they encourage homeowners to file insurance claims or even lawsuits.”