House members in the Capitol on Friday attached a proposal to resurrect so-called “one-way attorney fees” to a Senate bill on phosphate mining. (AP Photo/Phil Sears)

By Ron Hurtibise | rhurtibise@sunsentinel.com | South Florida Sun Sentinel
PUBLISHED: April 26, 2025 at 9:08 AM EDT

In an effort to keep alive their bid to resurrect the availability of so-called “one-way attorneys fees” in lawsuits against insurers, the Florida House adopted a bill that added their proposal to an unrelated Senate bill on Friday.

But if the House had hoped the amended bill would slip by the Senate, proponents of reforms that reduced insurers’ legal costs are urging senators to reject it when it comes back to them in the coming days.

“I hope the Senate will do the right thing and be the adults in the room,” said Stacey Giulianti, chief legal officer at Boca Raton-based Florida Peninsula Insurance.

The effort to restore the right of plaintiffs to claim attorneys fees in lawsuits against insurers has overshadowed dozens of other insurance-related bills introduced for the session, leaving only a handful with minor impacts poised for enactment.

Until the late bid emerged, the Senate seemed content to ignore bills that would require insurers to once again pay fees incurred by policyholders who sue them.

In arguing for the reforms three years ago, insurers said that the industry had become unprofitable due to an avalanche of frivolous lawsuits filed under a century-old Florida law. That law required insurers to pay legal fees if they agreed to settle litigation by paying as little as $1 over their original settlement offer. However, insurance customers were held harmless if they sued their insurers and lost.

The reforms placed Florida’s legal system on equal footing with most of the country, insurers said. Plaintiffs who sue are now required to pay attorneys out of their own pockets or a percentage of what they win.

But attorneys say that leaves plaintiffs unable to challenge denials or underpayments of small claims because attorneys can’t make enough money to justify taking their cases.

Knowing that emboldens insurers to treat policyholders unfairly, attorneys say.

A bill introduced prior to the current Legislative session by state Rep. Hillary Cassel, a Broward County Democrat-turned-Republican who is also a plaintiffs attorney, was approved by two House committees but still awaited a hearing by a third committee. Typically, bills must pass three committee hearings in both the House and Senate.

But the Senate — potentially responding to warnings from insurance industry leaders, the state’s insurance commissioner and Gov. Ron DeSantis — failed to schedule it for a single committee hearing.

The Senate also ignored a bill by its former president, Don Gaetz, that would also have empowered judges to award attorney fees to plaintiffs who prevail in their lawsuits.

On Wednesday, House member Berny Jacques attached language from the Cassel bill to an unrelated bill approved by the Senate clarifying that certain levels of radiation must be recorded before lawsuits could be brought against owners of former phosphate mines.

Rather than “one-way attorney fees,” supporters insist that the bill should actually be called a “prevailing party” or “loser pays” measure. It would require insurers to pay plaintiffs’ attorney fees if a court awards them more than an amount offered by insurers, but plaintiffs would be required to pay insurers’ fees if a court awards them less than the insurer proposed.

During debate over the bill on Friday, Rep. Michael Gottlieb, who represents part of Broward County, predicted the prevailing party provision would “discourage litigation because you’re not going to want to, number one, prolong litigation, and number two, get involved in litigation that you’re going to lose.”

Rep. Tyler Sirois, from Brevard County, said the bill would reinstate “balance.” He added, “We made it too easy for insurers to delay, deny and underpay claims — making it harder for honest Floridians, whether they’re carrying a hammer or a calculator, to fight back.”

During the debate, no member of the House spoke against the amended bill and it was adopted by a vote of 80-20.

As part of the back-and-forth that must occur to get a unified bill approved by the entire Legislature, the amended bill now goes back to the Senate, which could vote on the House’s version, remove or change the amendment, or just let it die.

Jacque’s filing of the amendment on Wednesday set off a flurry of activity by industry supporters who again warned that passage would undermine progress tracked since the reforms were enacted, drive up litigation and force insurers to increase premiums.

It also prompted Insurance Commissioner Michael Yaworsky to send an email warning Peter Cuderman, Gov. DeSantis’ director of legislative and intergovernmental affairs, that the bill could dismantle “the hard-won progress” achieved by the 2022-2023 reforms.

That progress, Yaworsky wrote, includes declining reinsurance costs for insurers, 65 rate filings that were either reduced or included no increases, introduction of 12 new insurers into Florida’s market, and a 23% decrease in lawsuit filings year over year.

Potential impact of the House’s bill, he warned, included increases in lawsuits, insurer costs, reinsurance rates, private investment, and the population of state-owned Citizens Property Insurance Corp., the insurer of last resort.

After the vote, the pro-industry Florida Chamber released a statement saying it would continue fighting to stop the bill, which also removes restrictions on medical claims by patients, from becoming law.

“Going backwards is the wrong move for Florida,” the statement said. “We should allow these reforms to continue to work, not re-allow scamsters to artificially drive up medical costs to inflate verdicts and incentivize litigation over small dollar amounts with the promise of attorneys’ fees for the people on the billboards.”

Brian Murphy, who owns a Brightway insurance agency franchise in Palm Beach Gardens, said after the hearing that he favored keeping the reforms as they are. If positive trends continue, he said, “it’s a sign that the state’s efforts to revitalize the insurance landscape are working.”

Dulce Suarez-Resnick, an insurance agent based in Miami, said supporters predicted reforms wouldn’t be felt for three years.

“We are two years in and I’ve already seen a lot of impact,” she said. “The Legislature needs to be patient. We have one more year to go.”

William Large, president of the Florida Justice Reform Institute, said the House proposal would bring back “one-way attorney fees.”

“Unless an insurer gets a zero verdict, they’re going to end up paying attorneys fees,” he said.

Also troublesome, Large said, is a provision of the bill that would allow attorney fees to be awarded if a plaintiff wins a “declaratory judgment,” which is simply a declaration by the court that an insurer is responsible for paying a claim. It’s “going to create an incentive for attorneys to litigate declaratory judgment actions to generate fees,” Large said.

Only a few insurance bills have passed the House and Senate.

The handful of bills headed to the governor’s desk after approval by both chambers include:

— SB 114 / HB 1097 — Transfers hurricane loss projection modeling from Florida International University to Florida State University.

— SB 1076 / HB 715 — Expands roofing contractors’ scope of work to include evaluation and enhancement of roof-to-wall connections; narrows cancellation window for contracts signed after emergencies.

— SB 176 / HB 1041 — Limits property tax increases for homes elevated to prevent flood damage if voters approve constitutional amendment in November 2026.

— SB 948 / HB 1015 — Requires landlords to provide flood risk information to tenants before signing leases. Gives tenants 30 days after a flood to terminate a lease if the disclosures are not provided and the tenant suffers flood damage.

Bills with little chance of enactment

Meanwhile, a long list of bills received no hearings in committee, made it through fewer than the required number of committee stops, or were ignored by one or the other chamber.

Giulianti doesn’t want to see any of them enacted this year. “It’s best for the Legislature to continue to let all the (2022 and 2023) changes work their way through the system through all of the insurance renewal cycles, and then decide next year if anything needs tweaking,” he said.

Property insurance bills left on the table would have allowed policyholders to:

— Hold the owners of fallen trees responsible for damage to their properties.

— Protect personal information entered into Uniform Mitigation Verification Inspection forms.

— Access rate transparency reports or see rating examples for their counties in filings to the Office of Insurance Regulation.

— Learn how their premiums are being distributed among subsidiaries, captive vendors, management companies and reinsurers.

— Require that their insurer pay specific fees for services provided by affiliates.

— Tap into a $500 million emergency trust fund if they are having trouble paying their insurance bill.

— Hold their surplus lines insurer responsible to pay up to the full amount of the insured value set in their policy.

— Require that their insurer participate in mandatory dispute resolution hearings prior to litigating.

— If they are a Citizens customer located outside of a FEMA flood zone, get out of the new requirement to hold flood insurance.

— Weigh advice from an Insurance Solutions Advisory Council or have access to a consumers guide to homeowner insurance.

— Be protected from cancellation while trying to repair damage from floods or hurricanes.

— Seek reimbursement for wind and flood damage mitigation projects through the My Safe Florida Home program.

Ron Hurtibise covers business and consumer issues for the South Florida Sun Sentinel. He can be reached by phone at 954-356-4071 or by email at rhurtibise@sunsentinel.com.

1990 law prevented people from seeking non-economic damages in cases
By Jim Saunders | News Service of Florida
UPDATED: March 26, 2025 at 6:16 PM EDT

TALLAHASSEE — The Florida House on Wednesday overwhelmingly passed a proposal that could lead to more medical-malpractice lawsuits, while a similar bill cleared a major hurdle in the Senate.

House members voted 104-6 to approve the bill (HB 6017), which involves wrongful-death lawsuits and what are known as “non-economic” damages for such things as pain and suffering.

The bill would repeal part of a 1990 law that prevents people from seeking non-economic damages in certain circumstances. People who are 25 years old or older cannot seek such damages in medical-malpractice cases involving deaths of their parents. Also, parents cannot seek such damages in malpractice cases involving the deaths of their children who are 25 or older.

Supporters of the bill contend that the law has prevented family members from holding doctors and hospitals accountable for malpractice. Family members who have repeatedly testified at legislative committee meetings about the deaths of parents or children watched from the House gallery as the bill passed.

“For too many families across Florida, justice has never had a chance,” Rep. LaVon Bracy Davis, D-Ocoee, said.

But opponents of repealing the law argue it will lead to increased malpractice insurance premiums, which would result in doctors deciding not to practice in Florida. Andrew Bolin, a medical-malpractice defense lawyer who represents the business-backed Florida Justice Reform Institute, said Wednesday that the proposed change would lead to “infusing hundreds of new lawsuits into the system.”

House members who voted against the bill were Rep. James Buchanan, R-Sarasota; Rep. Wyman Duggan, R-Jacksonville: Rep. Tom Fabricio, R-Miami Lakes; Rep. Karen Gonzalez Pittman, R-Tampa; Rep. Toby Overdorf, R-Palm City; and Rep. Will Robinson, R-Bradenton.

The bill was sponsored by Rep. Dana Trabulsy, R-Fort Pierce, and Rep. Johanna Lopez, D-Orlando.

The House vote came hours after the Senate Rules Committee approved the Senate version of the bill, which is now positioned to go to the full Senate. The committee gave approval after rejecting an amendment that would have created a major difference with the House bill.

Sen. Gayle Harrell, R-Stuart, voted against the bill, saying it would create a disincentive for doctors to practice in Florida because of insurance costs.

“We will have doctors leaving the state,” she said.

But Senate bill sponsor Clay Yarborough, R-Jacksonville, described the current law as unjust and said it does not “value life” and provide accountability for medical negligence.

“For me, it simply comes down to every life has value,” Sen. Jennifer Bradley, R-Fleming Island, said.

Proposals to change the 1990 law have surfaced periodically over the years and have spurred lobbying fights. Opponents of the bills this year have included the Florida Hospital Association, the Florida Medical Association, the Florida Osteopathic Medical Association, the Florida Insurance Council, the Florida Chamber of Commerce and Associated Industries of Florida. Supporters have included the Florida Justice Association, which represents plaintiffs’ attorneys, and AARP.

Originally Published: March 26, 2025 at 6:02 PM EDT

 Florida Foundation Authority/R/J Group, Inc.)

A blue tarp covers a roof after a recent Florida hurricane. A state senator has filed a bill that aims to get policyholders paid by their insurers more quickly,, but insurance experts say it will do more harm than good. (Florida Foundation Authority/RJ Group, Inc.)

By Ron Hurtibise | rhurtibise@sunsentinel.com | South Florida Sun Sentinel
PUBLISHED: February 15, 2025 at 7:00 AM EST

A political titan has filed a provocative bill he says will reduce insurance costs in Florida — and the insurance industry doesn’t like his proposals.

One provision would roll back recent restrictions on fees that attorneys can collect when they sue insurers. Another provision would require insurers to publicly disclose their companies’ subsidiaries and affiliates and all of the ways their executives benefit from them.

The proposals are in similar bills filed in the state House and Senate this week. The House bill was filed by Rep. Alex Andrade, R-Pensacola.

The Senate bill was filed by Sen. Don Gaetz, R-Crestview, a longtime heavyweight in Florida politics and father of former U.S. Rep. Matt Gaetz.

Don Gaetz was reelected to the state Senate last fall after an eight-year absence. Last year, he campaigned on promises to fix an insurance system that has continued to raise costs for homeowners while saving significant money avoiding legal costs.

“Floridians pay far more for property insurance than anyone anywhere else in the nation,” the two lawmakers were quoted in a news release as saying. “Admittedly, Florida is a high-risk market, but we believe there are steps the Legislature can take to improve how rates are set and how individual claims can be processed faster and fairer.”

The release quoted Gaetz blaming high insurance prices for the slowing pace of new residents coming to Florida.

“High insurance costs make the Free State of Florida into the Unaffordable State of Florida for many seniors on fixed incomes trying to stay in their homes, young families including military families trying to buy their first homes, and businesses of every size,” Gaetz was quoted as saying.

Gaetz ran on fixing insurance

In an interview with the South Florida Sun Sentinel, Gaetz said he came out of retirement and ran for Senate last year because he had heard from Northwest Florida residents going through “serious problems” caused by “bad actors in the insurance industry.”

Despite Gaetz’s stature and name recognition, the bills’ proposals will elicit pushback among members of the House and Senate who — assuming the bills are taken up by committees — will contend that the current set of reforms enacted between 2021 and 2023 are working as intended.

“We cannot support these bills,” said Michael Carlson, president and CEO of the Personal Insurance Federation of Florida, which represents national insurance carriers and their subsidiaries.

Stacey Giulianti, chief legal officer for Boca Raton-based Florida Peninsula Insurance, said the reforms enacted from 2021 to 2023 are working and should be left as is.

“My take is that it’s not necessary, at least from the attorney fee perspective,” Giulianti said. “There are still plenty of lawyers taking cases. In fact, we still get about 100 lawsuits per month. Moreover, to go back to the old days where we paid 70% of the monies to attorneys, which was basically a cottage industry, seems completely unnecessary now that the market is stabilizing and capacity is up.”

Insurers contended that prior to the reforms, a limited but prolific group of plaintiffs attorneys figured out how to profit from a century-old Florida law that held insurance customers harmless if they sued their insurers in claims disputes and lost, but paid 100% of their legal fees if the insurer agreed to pay as little as a $1 more than their original settlement offer.

That law, called the “one-way insurance fee statute,” made way for an avalanche of frivolous lawsuits, according to insurers, that attorneys could file without exposing themselves to the possibility that they or their clients might be stuck paying insurers’ fees.

Now, a policyholder who wants to sue an insurer has to pay an attorney upfront or guarantee a percentage of any award. Attorneys who make their livings taking cases on contingency — without requiring upfront payment — are turning away cases over small damage amounts that they once eagerly accepted.

The bills would create a framework for reprising payments to plaintiffs’ attorneys. They would get 100% of their fees if an insurer agrees to settle for at least 80% more than the policyholder demands.

If the judgment falls within 20% and 80% of the demand, the plaintiff would collect an equal percentage of their attorney’s fees.

Only if the award is less than 20% would insurers be required to pay none of the plaintiff’s attorney fees.

The language also enables full recovery of attorneys fees by plaintiffs if insurers fail to comply with timelines for responding to claims or participating in mediation, if the plaintiff’s demand “is deemed reasonable by the court,” or if a court finds evidence of bad faith or abuse of the litigative process.

Those provisions, said William Large, president of the Florida Justice Reform Institute, amounts to “inserting the one-way attorneys fee provision back into law.”

While the reforms required plaintiffs to risk losing to the insurance company and paying its legal fees, the bill would again leave policyholders harmless whether they win or lose.

Gaetz acknowledges that, but counters, “This bill is going after bad actors in the insurance industry who don’t respond in a reasonable, fair and prompt fashion to legitimate claims.”

He points to the experience of a Panama City mother of two disabled sons who he had known. They lost their home in Hurricane Michael in 2018 and for more than a year was “ping-ponged back and forth between adjusters and lawyers” before her insurance company offered her 40 cents for every dollar of damage, which would have left her unable to rebuild her home, Gaetz said.

Ultimately, “she was so grateful to get 85 cents on the dollar” to settle her claim, he said.

Bill would require disclosure of subsidiaries

Another proposal in the bills would require the state to create reports disclosing to the public information that insurers currently label as trade secrets.

One would list all of an insurers’ subsidiaries, management companies, captive vendors and reinsurers that they have ownership stakes in and share common officers or directors. The report would detail the financial relationships between the entities.

Another report would detail compensation of each executive officer, including salaries, benefits, stock options, bonuses, stock buybacks and other taxable payments, along with profits and losses of each entity and highlight any compensation exceeding the industry average. It would also be required to explain effects of the compensation on insurers’ rate change requests.

Gaetz says the information would have to be used in rate setting, which he says isn’t occurring now.

He says he’s aware of insurers who move funds to management companies and consultants — “basically captive and owned vendors” — so they can appear to have much lower capital and profit levels when filing for rate increases.

“So if we find there’s excessive compensation with stock options and bonuses and perks and salaries, or if we find that the insurance company is sliding money off of their books and into other subsidiaries … we need to have an honest set of books that tells us where the premium dollars came from and how the premium dollars are used.”

But Paul Handerhan, president of the Fort Lauderdale-based Federal Association for Insurance Reform, says the Office of Insurance Regulation already requires such reports to be submitted. They just don’t post them on their website because they include proprietary information about companies’ business strategies.

“The insurance commissioner 100% is looking at every expenditure, every expense the insurance company has, even if those contracts are with affiliate or captive organizations,” Handerhan said.

A Dec. 18 story posted on the industry website Insurance Journal reported that ratings firm AM Best found that 13 Florida insurers that went insolvent since 2017 had surrendered almost all of their premiums to subsidies known as Managing General Agencies. Handerhan and other industry representatives were quoted in the story as saying that Florida insurers are so scrutinized by regulators, reinsurance and ratings firms, they had little room for diverting revenue unnecessarily.

Other proposals in the bill would:

— Increase the interest rate on insurance judgments or settlements from 4% to 8%.

— Require insurance adjusters to use electronic estimating software with price data consistent with contractor rates in a home’s geographic market. A loss adjustment report would have to be provided to policyholders within seven days of the inspection.

— Require insurers and policyholders to share equally in the cost of mediation, when invoked. Insurers can no longer delay claims disputes by asserting the right to reinspect damaged property.

Gaetz says he’s aware that the bill has its critics and might not even be heard by a committee — a decision that would lead to its defeat.

“I would expect William Large and others who speak for the insurance industry to oppose the bill. I would be surprised if they didn’t. But I expect a fierce fight.”

Ron Hurtibise covers business and consumer issues for the South Florida Sun Sentinel. He can be reached by phone at 954-356-4071 or by email at rhurtibise@sunsentinel.com.

©2025 South Florida Sun-Sentinel. Visit sun-sentinel.com. Distributed by Tribune Content Agency, LLC.

 

Heritage Insurance seeking hefty rate hikes, blames claims fraud

By Ron Hurtibise Sun Sentinel – March 2, 2018

Heritage Property & Casualty, one of the state’s largest homeowner insurance companies, is seeking double-digit rate increases for new and renewing customers this year.

It’s part of a storm of large rate increases by insurers throughout the state. Industry officials blame insurance fraud tied to the “Assignment of Benefits” crisis. They add that further rate hikes stemming from Hurricane Irma last year will start hitting consumers this summer.

Heritage’s increases, if approved, will affect tens of thousands of customers throughout the state — including most of the 92,200 former customers of state-run Citizens Property & Casualty assumed by Heritage through the state’s “takeout” program.

Those customers, called “Select” policyholders by Heritage, would see rates increased by an average 14.5 percent beginning May 1, according to the Clearwater-based company’s rate filings with the Florida Office of Insurance Regulation. The agency has final say on whether they will be approved.

Also affected would be 60,521 consumers who weren’t acquired through the Citizens takeout program — who Heritage calls “Preferred” policyholders. They would get a statewide average 14.2 percent increase upon renewal after July 1.

At the end of September 2017, Heritage had 41,658 homeowner policies in the tricounty region — down from 49,658 two years earlier. The company stopped writing new policies in the region in 2016 because of the claims crisis and later resumed writing only to a select few customers.

Responding to questions by email, Heritage CEO Bruce Lucas said the latest rate increases are a direct result of Assignment of Benefits abuses — a claims cost driver that insurers say begins with repair contractors convincing policyholders to sign over the right to directly bill insurers for repairs made to their homes.

Contractors then do unnecessary work, submit inflated invoices to insurers and — working with about a dozen mostly South Florida-based law firms — bombard the insurers with lawsuits in hopes that plaintiffs win quick settlements and attorneys collect fat legal fees, insurers say.

Contractors then do unnecessary work, submit inflated invoices to insurers and — working with about a dozen mostly South Florida-based law firms — bombard the insurers with lawsuits in hopes that plaintiffs win quick settlements and attorneys collect fat legal fees, insurers say.

“Assignment of Benefits fraud is costing homeowners over $1 billion annually,” Lucas said. “Every insurer is raising rates across Florida because AOB is the largest fraudulent scam impacting Florida in the history of the state.”

Contractors and attorneys counter that they file suit when insurers underpay or refuse to pay fair settlements for their work. Several contractors recently told state lawmakers that insurers deliberately become adversarial when they learn a policyholder has enlisted third-party assistance by signing an AOB with a contractor, or hiring an attorney or public adjuster to help with their claim.

According to a report from the Florida Justice Reform Institute, the number of insurance lawsuits with an AOB increased statewide from 82,263 in 2015 to 129,781 in 2017.

Yet, efforts to find a legislative solution have failed for five straight years amid fighting between the insurance industry and plaintiffs attorneys. This year’s session looks no different, as compromise has eluded the two sides with just a week to go before lawmakers go home.

Edie Ousley, vice president of public affairs for the Florida Chamber, which sides with insurers in the standoff, said the Heritage rate proposals come as no surprise.

“For lawmakers who don’t think AOB reform is needed, this should be another wake-up call that something must be done,” she said in an emailed statement.

Companies that have imposed steep rate increases on their customers over the past year include People’s Trust (16 percent), Citizens (6.7 percent), Southern Fidelity (14.6 percent), State Farm (9.5 percent), and Castle Key (10 percent).

While South Florida is considered the worst area of the state for AOB abuses, Heritage’s rate filing includes requests for large increases in territories outside of the tricounty region, including, for CItizens takeout customers, 25 percent hikes in parts of Hillsborough, Brevard, Escambia, Martin, and Okaloosa counties. Increases approaching 25 percent are sought for parts of Pinellas, Sarasota, and Indian River counties.

Lucas said those rate-hike requests reflect the spread of claims assignment abuses throughout the state.

A majority of Heritage’s former Citizens policyholders in South Florida would see increases ranging from 13.8 percent ot 15.5 percent.

Average requested increases for tricounty homeowners who weren’t acquired through the Citizens takeout program range from 13.8 percent to 25 percent.

Statewide, about 17,425 condo owners acquired from Citizens would get rate increases averaging 7.1 percent. The company’s 8,000 mobile home owners would pay an average of 13.8 percent more, and owners of 17,900 rental homes would pay 14.9 percent more for dwelling/fire coverage.

Lucas said Heritage’s pending rate increases do not reflect expected hikes for costs of reinsurance that insurers must have in place before the June 1 start of hurricane season. Reinsurance costs for Florida insurers are projected to increase as a result of losses paid to victims of Hurricane Irma, and that will trigger a separate round of rate hikes for consumers, he said. “Reinsurance [costs] are going higher and rates will move higher as a result,” he said.

Dulce Suarez-Resnick, vice president of sales and marketing for Miami-based agency NCF Insurance Associates, said she expects flood insurance premiums to increase beginning in October.

She also noted that auto insurance rates are rising 15 percent to 25 percent for drivers with no tickets or accidents. “I don’t know how we’re going to be able to afford insurance in South Florida,” she said.

http://www.sun-sentinel.com/business/fl-bz-heritage-insurance-145-percent-rate-increase-20180302-story.html

 

Florida homeowners need break from assignment-of-benefits lawsuits | Opinion

By Harold Kim – November 7, 2017

Florida consumers are used to paying higher insurance premiums in the wake of devastating hurricanes. But an entirely preventable, human-driven phenomenon is now driving rates even higher: Assignment-of-benefits (AOB) claims, in which home-improvement contractors and other vendors submit inflated bills to insurers with the help of fee-motivated lawyers.

Consumers are typically innocent pawns in this game. Soon after a big storm or flood, vendors approach them with a promise to fix the damage now, in exchange for signing over any insurance benefits they may receive later.

What few consumers see buried in the contracts they unwittingly sign is that they are also agreeing to sue their insurance company if it balks at paying the often-inflated bills the vendor submits. But even that isn’t the most expensive part: Under a Florida statute originally intended to level the playing field between individual consumers and insurance companies, “their” attorney — working for the vendor, not the consumer — can collect hundreds of dollars an hour in fees if a court awards as much as a dollar above the insurance company’s initial offer to settle the case.

This “one-way” fee statute gives vendors and their lawyers a strong incentive to perform substandard work and then submit inflated and fraudulent claims, confident the insurer will pay them rather than engage in drawn-out litigation where the legal fees eventually will dwarf the amount of the original claim.

The damage from AOB litigation is clear. In 2000, there were roughly 460 AOB lawsuits. By 2016, there were a staggering 28,000 claims, according to the Florida Office of Insurance Regulation. While the number of claims is alarming enough on its own, AOB claims tend to be particularly expensive. One study of more than 80,000 Florida insurance claims showed the average AOB claim was $17,000 — 50 percent more than non-AOB claims.

Defying the laws of nature and probability, these cases tend to be concentrated in a few specific parts of the state including Miami and Tampa. These are, not surprisingly, where lawyers who specialize in AOB litigation advertise and concentrate their activities. Just 11 attorneys accounted for a quarter of all AOB lawsuits from 2013 to 2016. Without AOB reform, Florida regulators predict property insurance rates in Miami-Dade County will rise more than 50 percent by 2022.

And it’s not just home repairs. The AOB scam has proliferated with cracked windshields. Glass repair shops have begun actively seeking out AOB arrangements, sometimes even throwing in $100 gift cards to sweeten the deal. Unfortunately, the handful of vendors who account for most claims tend to charge 100 percent more than nationally-known vendors — even before legal fees.

Pro-lawyer judges helped create the AOB mess, but the Florida Legislature has the power to fix it. Reforms are needed now to eliminate the incentives for crooked vendors to collude with plaintiff lawyers and raid the one-way attorney fee cookie jar. And, in fact, sensible reform bills have been considered in the Florida Legislature that would limit the fees attorneys can charge insurance companies when they are working for an outside vendor, not the policyholder. But pro-trial lawyer legislators have killed these bills again and again. In 2017, a Senate committee refused to even hear a bill.

It’s a shame a few influential legislators can block AOB reform in Florida, especially given the rising costs, fraud, and excessive attorney fees. There was a time not long ago when Florida was a beacon of lawsuit reform, reforms that were meant to unclog the courts, help the truly injured find justice, and prevent a handful of lawyers from gaming the system. It’s long past time for the Legislature to take up that mantle again.

Harold Kim is executive vice president of the U.S. Chamber Institute for Legal Reform. Learn more at www.instituteforlegalreform.com

http://www.sun-sentinel.com/opinion/commentary/fl-op-viewpoint-assignment-of-benefits-lawsuits-20171102-story.html#