Citizens Property Insurance Bill Advances in the Senate
As you may have heard, Senate Bill 1714 (the CPIC rate increase bill) passed through the Senate Banking and Insurance committee yesterday following the passage of a strike-all amendment filed by the bill's author, Senator Alan Hays.
The newly amended bill forces Citizens to cover sinkholes, but mandates that “the payment must be dedicated entirely to the costs of repairing of the structure or remediation of the land,” otherwise “the corporation is prohibited from making payments.” (emphasis added) Further, the bill prohibits Citizens from covering any newly permitted structure seaward of the coastal construction control line.
Of course, the bill also provides that:
The corporation shall implement a rate increase each year for each residential line of business it writes, which may not exceed 20 percent by territory and 25 percent for any single policy, excluding coverage changes and surcharges. This subparagraph expires January 1, 2015, and does not apply to rates for sinkhole coverage or costs for the purchase of private reinsurance, if any. (emphasis added)
Regarding public adjusters,
[P]olicyholders may not engage the services of a public adjuster to represent the policyholder with respect to any claim filed under a policy issued by the corporation until after the corporation has tendered an offer with respect to such claim. For any claim filed under any policy of the corporation, a public adjuster may not request payment or be paid, on a contingency basis or based in any way, directly or indirectly, on a percentage of the claim amount, and may be paid only a reasonable hourly fee based on the actual hours of work performed, subject to a maximum of 5 percent of the additional amount actually paid over the amount which was originally offered by the corporation for any one claim.
Everyone should also take a look at the deletion of lines 46-81. These were the findings of the Legislature a few years ago; it is very interesting to see that we have come full circle since then and that the legislature sees fit to depart from its position under now U.S. Senator Rubio and now CFO Jeff Atwater. As an ironic side note, those two men were the architects of the current insurance system that the Legislature is now dismantling.
One comment regarding the changes made to the public adjuster language.
It is very contradicting to have the words "reasonable hourly fee" and not to exceed 5 percent of the new amount in the same description. Additionally they have failed to address expenses.
The bill also proposes to eliminate Citizens statutory obligation to pay the policyholder's reasonable attorneys fees in not only future lawsuits, but in all pending lawsuits as well. Can you imagine how well that will be received by our clients in pending lawsuits if the bill is enacted and their entire legal fees will have to come out of the recovery.
"Mother of mercy, is this the end of Rico!"
We should be able to get a lot of help from the legal community at large in fighting this unconstitutional deprivation of the right to representation.
Certainly if the insurance lobby gets away with this
the right to legal representation will be the next
to fall.
Please list PACs that we can support. Thank you.
Daniel Friedman
561 929 8299
Ref: Citizens and SB 1714 (The deletion of lines 46-81...) Watch for the fall-out..."forced-place" coverage.