Florida Bill Revives Windshield Issue Left Out of AOB Reform
September 18, 2019
TALLAHASSEE, Fla. - A Florida lawmaker is taking aim at a target that escaped untouched out of the state’s assignment of benefits legislation that became law this summer — automobile glass repair insurance reform.
State Rep. Richard Stark has introduced a bill that would ban auto glass repair shops from offering consumers a rebate, gift, gift card, cash, coupon, or any other thing of value in exchange for making an insurance claim. The prohibition extends to offers made by third party who is compensated for solicitations.
The bill is designed to stem a tide of auto glass AOB lawsuits over the past 15 years or so, said Michael Carlson, president and chief executive officer of the Personal Insurance Federation of Florida.
David Altmaier, commissioner of Florida’s Office of Insurance Regulation, said he expects the upward trend of lawsuits will continue without the passage of legislation.
“We do expect those trends to continue, to increase,” he told a senate committee.
The American Property Casualty Insurance Association in April cited Florida Department of Financial Services information that in 2006, approximately 400 auto glass AOB lawsuits were filed against auto insurers. In 2016, that number rose to nearly 20,000 (Best’s News Service, April 12, 2019).
AOB issues continued to mount in the years before AOB reform was passed, according to studies done by the Florida Justice Reform Institute, which most recently reported AOB lawsuits increased 18% from 2017 to 2018.
In a 2017 study, the institute found that auto glass AOB lawsuits were the biggest driver by volume.
William Large, who authored the institute’s studies, said consumers should not be offered incentives to choose a windshield repairer.
“The customer’s sole incentive for making an insurance claim for motor vehicle glass replacement or repair should be because of a broken or damaged windshield,” he said. “Gifts, gift cards, or other things of value should never be used to incentivize an insurance claim.”
Attempts to get comment from the National Windshield Repair Division of the Auto Glass Safety Council were unsuccessful.
“The problem is not so much in the solicitation of the claims, where a driver assigns their benefits to a glass vendor for a gift card,” said Carlson. “We’ve seen a spike in litigation on auto glass claims, which really is symptomatic of a dispute over price in a marketplace where price is really well known.”
Carlson said the legislation probably will be the only way to stem the tide of lawsuits, because lawyers who had been filing AOB property lawsuits now are more constrained by the new law.
The top five writers of all private passenger auto insurance in Florida in 2018 were Berkshire Hathaway Insurance Group, with 25.23%; Progressive Insurance Group, with 18.33%, State Farm Group, with 14.74%; Allstate Insurance Group, with 9.28%; and USAA Group, with 7.07%, according to BestLink.
(By Timothy Darragh, associate editor, BestWeek: [email protected])