When Senate Bill 408 passed last May, several changes were made to Florida Statute 626.854, which defines public adjusters and limits the profession. Many of these changes and additions went into effect on January 1, 2012.
Continue Reading...The legislative session is moving at breakneck speed this year. At this point, we already have 31 bills on our “watch list.” Go to PolicyholdersofFlorida.com for a full list of these bills and their current status in the legislature.
Continue Reading...Next month, the Alabama legislature will reconvene and has the chance to license public insurance adjusters. Currently, Alabama is one of the few states that does not recognize public adjusters. But after the devastation last year, the value of public insurance adjusters is coming to light.
Continue Reading...The 2012 Legislative session is right around the corner. It’s hard to believe December has already arrived, leaving only one more committee week before session begins on Tuesday, January 10, 2012.
Many bills favored by leadership have already cleared their first major hurdle by navigating through at least one committee.
Continue Reading...Senate Bill 425 was passed this past legislative term, adding a new chapter to the Texas Insurance Code. The new law requires the Texas Department of Insurance to approve certificates of insurance provided in connection with casualty and property policies. This new bill went into effect on September 1, 2011, and applies to certificates of insurance issued on or after January 1, 2012.
Continue Reading...Early this week, another property insurance bill, SB 846, was filed in the Florida State Senate. Before you jump out the window, or turn off your computer in disgust, I have some GOOD news -- SB 846 is actually good public policy.
Continue Reading...Tallahassee is buzzing – if you listen closely, you can hear it. As October winds to a close, the traffic on Interstate 10 is picking up, as is the mid-week crowd at Clyde’s & Costello’s. There’s only one thing that could mean – the 2012 legislative session is right around the corner.
Continue Reading...For the second straight term, a bill has been filed in the Florida Legislature designed to make changes to the well-settled legal principles that have successfully governed our state for many years and have held insurance carriers accountable when they act improperly.
Continue Reading...The 2012 session of the Florida Legislature will occur January 10, 2012, through March 7, 2012. Usually, the legislative session takes place from March to May, but since the Legislature is redistricting this year, the schedule has been moved up.
Continue Reading...Tuesday afternoon, I joined 250 fellow Floridians in the bright sunshine protesting against extraordinary rate hikes allowed by Florida’s most recent insurance legislation. Here is a picture of me with Florida Representative Richard Corcoran at the protest:
Scott Johnson, Executive Director of the Florida Association of Insurance Agents, has called me out for allegedly being on the wrong side of an insurance issue. In his post, CITIZENS SINKHOLES…Yet Another Look!, he stated in part:
Continue Reading...And so I’ve made overtures to my friend Chip Merlin, the founder of the Florida Association of Public Insurance Adjusters (FAPIA). He also employs Sean Shaw, who has gone from advocating for consumers to advocating for public adjusters.
I know this is a challenge; after all, public adjusters are the only real winners in this deal. But, my prayer is that Chip will do as he’s done when we’ve worked together in the past; simply examine the evidence a little more closely to see if there’s room for a different conclusion. Maybe ask a few questions. Seek a few clarifications. Try to find out, as I have, what’s best for the majority of consumers.
…
While we wait to see if Chip Merlin’s mind is made up or not, and thus whether Sean Shaw may rethink his stance as well here, again, is the exchange between myself and Ms. Stevak.
On April 19, 2011, I wrote a blog asking Chief Financial Officer Jeff Atwater to take a stand on Senate Bill 408. Unfortunately, we didn’t hear much from CFO Atwater’s office during the debate on 408. In fact, the little we did hear appeared to be regurgitation of industry talking points about “fraud” and “cost drivers.” When SB 408 was finally signed into law in May 2011, the CFO remained silent as to the potential impacts on consumers and industry. In June, we heard nothing – in July, still nothing. However, on August 2, 2011, we finally heard from the CFO’s office. During a cabinet meeting, CFO Atwater asked the following question, "There is the reality [that] there are mortgage players who want sinkhole coverage…How does a Floridian go from paying $350, $450 a year to $3,000, $4,000 a year?"
Continue Reading...For this installment of Tallahassee Spotlight, we focus on a House member at the center of all property insurance discussions in the Florida Legislature -- Bryan Nelson, a Republican insurance agent from Fort Myers. Like Senator Garrett Richter, who was profiled last week, Representative Nelson chairs his chamber’s committee on insurance – the Insurance & Banking subcommittee. That committee is charged with reviewing all insurance legislation passing through the state House.
Continue Reading...The Bradenton Times recently reported that skyrocketing insurance rates may be the result of a cozy relationship between Florida's legislators, governing officials and the insurance industry. In Which Citizens Are They Working For?, the article concluded:
Continue Reading...Frustrated consumers are baffled by skyrocketing costs across so-called regulated industries that continue to grossly outpace flat wages and wonder how regulators can justify such massive increases for hugely profitable corporations.
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Judging from the campaign disclosures, it is clear that these industries have been supportive of government. It might be time for taxpayers to ask whether government is being too considerate of them, while forgetting who they truly work for.
Before the end of the last Texas legislative session, the Texas legislature ended their Texas Windstorm Insurance Association (TWIA) reform stalemate and passed a comprehensive reform bill it hopes will better prepare TWIA for future catastrophes. The bill was sent to the governor, but he has yet to sign it.
Continue Reading...Another Florida Circuit Court has ruled that the neutral evaluation section of the Florida Sinkhole Statute is unconstitutional. Similar to the Order noted in Sinkhole Neutral Evaluation Unconstitutional, Hillsborough County Circuit Court Judge James Arnold's Opinion found:
Continue Reading...The United States and Florida Constitutions give everybody the rights to due process under law and a jury trial. These fundamental rights were important to the founders of this country. Yet, some Florida legislators fail to respect and observe these rights when it comes to making special laws which protect the insurance companies who fill their campaign coffers.
Continue Reading...Aside from protecting policyholders’ rights against their insurance companies, Merlin Law Group also monitors bills that may affect your rights as a policyholder.
Continue Reading...Early this week, I was sent the following letter from a Florida public adjuster. He contacted me because he reads this blog and knows I am always interested in hearing about trends in the adjustment of claims.
Continue Reading...Last Friday, the Houston Chronicle reported that Texas Governor Rick Perry has added the Texas Windstorm Insurance Association (TWIA) to the agenda of concerns to be addressed at the special legislative session.
Continue Reading...While giving a speech last week on the new Florida legislation, one of the frequent and important questions posed to me by the audience concerned the dates various parts of the law become effective.
Continue Reading...The most significant legislation involving Florida public adjusters is the limitation of fee compensation in Citizens claims. As quoted from Florida Legislative Update for Public Adjusters,
Continue Reading...For any claim filed under any policy of Citizens, a public adjuster may not charge, agree to, or accept any compensation, payment, commission, fee, or other thing of value greater than 10% of the additional amount actually paid over the amount that was originally offered by the corporation for any one claim.
On May 11, 2011, SB 408 was presented to Governor Scott, who signed the legislation into law on May 17, 2011 (Chapter Law 2011-39). The legislation became effective upon signing, with the exception of sections which specifically stated a later effective date. SB 408 is a sweeping piece of legislation that proposes various changes to Florida’s property insurance laws. The purpose of this analysis is to discuss the important changes relating to public insurance adjusters, claims handling, and sinkhole laws. This analysis will not discuss every change contained in SB 408.The page numbers in parentheses refer to the page numbers in Chapter Law 2011-39.
Continue Reading...Senate Bill 408 was presented to Governor Rick Scott on May 11, 2011. Governor Scott has 15 days to act on the legislation. Therefore, now is the time to contact his office to express your opinion on the bill. The bill is large and makes a lot of changes to current law.
Continue Reading...The title to the post may seem rather absurd, but raising insurance rates and mandating less coverage is exactly what Florida's legislators are doing with currently proposed laws. It is not escaping media covering business issues, as shown by Robert Trigaux, of the St. Petersburg Times, in “As state leaders push for higher rates, property insurers enjoy robust year.” In the article he noted:
Continue Reading...Over the course of two years, Sarasota Herald-Tribune reporter Paige St. John meticulously examined Florida's property insurers, compiling mountains of data by digging into financial records and chasing industry executives to far away places like Bermuda and Monte Carlo. St. John’s work exposed Florida insurers’ clandestine web of offshore accounts and shell corporations, which allow them to hide massive profits while leaving Floridians exposed to substantial risk.
Continue Reading...You can tell it is not an election year when consumers lose valuable rights because politicians, who promised to serve them, vote against consumer interests. Yesterday, I wrote a post, Good Guys Prevail Over Insurance Lobby, about a pro-consumer victory in the Florida House of Representatives. The loss was in the Florida Senate, where the insurance industry is supported by many key Florida Senators.
Continue Reading...As noted by Aaron Deslatte in 'Bad faith' Bill Gets a Bad Start in House Committee, the proposed legislation I commented on at length yesterday in A Terrible Proposed Law Which Could Harm All Floridians is Up For Consideration Today failed. This is a win for the Good Guys. There is no uncertainty that the Bad Guys, the insurance lobby, support these draconian changes to longstanding laws that protect policyholders.
Continue Reading...A proposed change to the Civil Remedy Law is coming up for vote today. This post will only comment about the impact it will have on first-party property insurance claims. The Bill is bad for homeowners, condominium owners, business policyholders and condominium associations. I am addressing practical aspects of how this law is harmful to policyholders with these types of claims that follow hurricanes, tornados, fires, floods and other disasters. If you are ever involved in an accident that results in a third-party claim against your insurer, this bill also changes existing law and the changes could make you liable for excess judgments that are essentially caused by your insurer’s failure to act in good faith to settle the claim.
Continue Reading...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.
Continue Reading...I recently traveled to Tallahassee to do some legislative work relating to the insurance bills before the Florida Legislature. In addition, on Tuesday I participated in a very successful press conference with Representative Kriseman and Senator Fasano that outlined how anti-consumer these bills are. In response to this press conference, the insurance industry and their legislative supporters made some interesting comments:
Continue Reading...In Major Bad Faith Legislation Filed in Tallahassee, I promised a further analysis of Florida Senate Bill 1592, explaining why this bill is bad for property insurance policyholders. Two striking parts of the bill is the elimination of accountability for good faith conduct and the prevention of common law remedies. This bill as written applies to more than just third-party claims practices -- it applies to first-party claims conduct. Here is an analysis substantially made by Ruck DeMinico of our firm:
Continue Reading...The Florida Senate must have taken a page from Insurance Company Declares War on Public Adjusters, as a recently filed Senate Bill SB 1714 prevents Citizens policyholders from hiring public adjusters. Since Citizens claims it is already immune from damages it causes while breaching good faith claims duties, policyholders would certainly lose if this bill becomes law. It would be easier for Citizens to reduce its claims costs by taking advantage of its policyholders after losses are suffered.
Continue Reading...So I guess we finally have an answer as to how we “fix” the insurance “problem” in Florida. The insurance industry, through some of our elected officials, has proposed some legislation that will “rein in fraud,” “inject some free market principles into insurance,” and “stop us from socializing insurance.” (All three of these quotes are actual remarks made by current Legislators). Let’s see what our industry friends have for us so far this session:
Continue Reading...Florida’s Senator Thrasher and Representative Baxley have filed identical bills which gut long-standing common law and statutory consumer protection laws.
Continue Reading...In a recent Florida House of Representatives Committee, Representative Plakon (R-Longwood) introduced a bill to remove the ability of the Insurance Consumer Advocate to issue letter grades to insurance companies based on how they treat their customers. Am I missing something?
Continue Reading...Insurance agents are some of the nicest people I have ever met. They are often trained in salesmanship and influence. Many participate in community activities for professional networking reasons. To effectively sell insurance, you better be a swell person and know a lot of people.
Continue Reading...Before the Hurricanes of 2004 and 2005, few people showed up for insurance related legislation and committee hearings. When some suggested I get to the meeting early to make certain I could find a seat, it was obvious that times had changed.
Continue Reading...Replacement cost, actual cash value, and total loss valuation payment definitions, procedures and issues are currently being debated before the Florida legislature. In Draconian Property Insurance Bill Filed in Florida Senate, I explained that the pending legislation was against policyholder interests. Our firm has other posts on this debate:
Continue Reading...On February 7, 2011, the Senate Banking and Insurance Committee met in Tallahassee to discuss SB 408. This was supposed to be the meeting at which the full bill would be voted on. However, it soon became clear that the bill was too complicated to make it through this meeting in time. The meeting was scheduled from 10:15am – 12:15pm. When the committee got to the portion of the agenda dealing with SB 408, they began where they left off last week – debating the numerous amendments being offered by Senator Mike Fasano. If you read this blog regularly, you know that Senator Fasano is often a voice in the dark for consumers on this committee. As Fasano began to go through his amendments, it was clear that his pro-consumer amendments were going to fail. In fact, several of the amendments were compromises between the industry and consumer positions. Nevertheless, they were consistently voted down. The St. Petersburg Times describes the testy exchange between Senators Alexander, Fasano and Negron. My favorite part of the meeting:
Continue Reading...Things got testy when Fasano's amendment requiring that homeowners receive an engineer's report after repairs are made came up. Sen. J.D. Alexander argued against the amendment, starting out by speaking broadly about the problems with sinkhole insurance claims and then charging that Fasano's amendment was probably written by a plaintiff's attorney.
Fasano shot back that he didn't need to be lectured on the sinkhole insurance issue, and wondered why nothing benefiting homeowners was included in the bill. "I could easily suggest this whole bill before us was written by the insurance industry," he said.
In less than a week, the Senate Banking and Insurance committee will vote on SB 408. If the session doesn’t start until March, what type of “vote” is taking place? Although the 2011 Session of the Florida Legislature does not begin until March 8, 2011, various committees of the House and Senate meet throughout the year. For a bill to become law, it must be voted on by the full legislature (usually during Session). However, before the full legislature can vote on a bill, if must be “heard in committee.” Thus, a bill must be heard by multiple committees in both the Senate and House. Then, the full Senate and House will vote on a bill before it can go to the governor for signature.
Continue Reading...Megyn Kelly, of FoxNews interviewed me last Friday. The topic was "Who Will Take the Lead in Deficit Debate." She appropriately raised the important issue whether our political leaders have the courage to change spending and tax policy to prevent government bankruptcy. Here is the Interview:
Continue Reading...Florida Senator Mike Fasano is not afraid to talk about the elephant in the room. Yesterday, he called the proposed insurance bill "scary." A blog in the Miami Herald, Fasano: Why debate sinkhole coverage if no one will provide it anymore? reported:
Continue Reading...The New Year brings new opportunities and new challenges. Unfortunately, this year brings more challenges than opportunities for policyholders in Florida. Charlie Crist no longer wields the veto pen that struck down anti-consumer legislation in the past. Instead, he has been replaced with a Governor who campaigned on a very pro-industry platform. In addition, the Florida Legislature may have become even more pro-industry than before. These circumstances have created an atmosphere in Tallahassee whereby the industry is in a position to get a lot of the changes it has previously lobbied for.
Continue Reading...Senate Bill 408 proposes new Florida insurance laws that harm all policyholders. Florida businesses and homeowners will receive fewer benefits, and insurers will be encouraged to delay, deny and defend claims if this bill becomes law. It takes away a lot of financial peace of mind that insurance currently provides.
Continue Reading...Gene Veno, President of the American Association of Public Insurance Adjusters, forwarded to me a new law governing public adjusters in New Jersey. The primary items of interest in the revised New Jersey statute concern public adjuster solicitation and continuing education.
Continue Reading...The fix appears to be in for sinkhole losses. The insurance industry and lobby worked hard to set the rhetoric in its favor. Florida's Insurance Commissioner seems to now be more concerned about appeasing the insurance industry to keep his job rather than taking on an industry he used to battle. Many policyholders with property in sinkhole prone areas of Florida will financially be doomed given the scenario painted in the Florida Senate Committee on Banking and Insurance Interim Report, "Issues Relating to Sinkhole Insurance."
Continue Reading...Fox News had me debate cell phone bans last fall. Transportation Secretary Ray LaHood was calling on Congress to pass a national law banning the use of cell phones in vehicles. Millions of us safely use cell phones in automobiles. Many conduct business, get directions and otherwise use the phone for work efficiency while in our automobiles. Research has never supported the assumption that banning cell phone use in automobiles saves lives or reduces property damage claims.
Continue Reading...Insurance company executives were thrilled that Rick Scott won the Florida Governor's office. I can appreciate that any politician may run on a platform that, upon further reflection, seems absurd or not what they meant. From my impression, many voted for Scott because they were fed up with the status quo. Floridians may be even more upset if they learn that their newly elected governor is supporting a plan which will result in higher property insurance rates and laws that would provide immunity to insurers who treat their customers in bad faith.
Continue Reading...Surplus insurers in Florida, a/k/a “non-admitted” insurers, have traditionally been exempted from certain regulatory schemes applicable to traditional “admitted” insurers. This was done to persuade these non-admitted carriers to continue to write insurance on risks not as attractive to the admitted carriers. As pointed out by Dick Tutwiler in his comment to my November 1, 2010, post, Eligibility Requirements for Florida Surplus Lines Insurance Carriers, two 2008 court decisions threatened the stability of the surplus lines insurance market in Florida.
Continue Reading...The Colodny, Fass, Talenfeld, Karlinsky & Abate law firm sent a newsletter regarding Freshman House Representative Frank Artiles' recent teleconference. In "Freshman State Representative Frank Artiles, a Public Adjuster, Meets With Florida Insurance Industry Representatives On Concerns, Commonalities" the lawfirm noted the following:
Continue Reading...The recent election results clearly showed that people were upset with those running government—especially those in the Democratic camp.
Continue Reading...Politicians who keep their campaign promises should be applauded. They are a special breed, particularly when knowing that such integrity will be criticized. Charlie Crist kept his word to Floridians when he vetoed a property insurance bill that would have allowed insurance companies to raise rates by ten percent each year. His veto is a huge victory for every Floridian who is outraged over the highest property insurance premiums in the country. The insurance industry offered the most illogical of all arguments as to why the proposed law was "consumer friendly:" by allowing rates to go up, insurance premiums would go down. This point was made in Do Florida Legislators Think We Are Stupid?
Continue Reading...Today is the day Governor Crist decides the fate of the pending property insurance bill by choosing whether to exercise his veto. Yesterday, investigative journalist Paige St. John's article, Lobby Had a Hand in Insurance Bill, was on the front page of the Sarasota Herald-Tribune. While I was unsuccessfully advocating for policyholders this past legislative session, I observed the insurance lobby, with an army of insurance lawyer lobbyists, seemingly writing most of the proposed laws that eventually passed. Indeed, I have not found one quote from a Florida representative claiming to have stopped any insurance industry sponsored law.
Continue Reading...In an editorial, Insurance Bill Needs Improvement, the Miami Herald called on Governor Crist to veto the property insurance bill now sitting on his desk.
Continue Reading...Religion sure brings out some strong and sometimes bitter feelings among friends. A number of adjusters, after hotly debating the topic with emails copied to me, have inquired whether the pending property insurance bill is unconstitutional because of the exemption to the required examination given to the members of the National Association of Christian Catastrophe Insurance Adjusters. Since I am scheduled to take the California Bar Examination this July, some may think that my First Amendment Constitutional Law expertise has been refreshed with recent study and that I am able to address this question. My friends know better and often wonder how I passed any bar examination.
Continue Reading...Governor Charlie Crist will certainly be asking himself the question whether the property insurance legislation before him is bad for average Florida insurance consumers. Yesterday’s afternoon post, Pay Higher Premiums and Get Less Coverage Legislation -- Can Anybody Explain Why This is Good for Floridians? provided a simple explanation of why many are calling for Governor Crist to veto this legislation. The analysis is not easy because the proposed law was rolled into one massive piece of legislation, some very bad and some good. The media is starting to pick up the overall aspects of the proposed law.
Continue Reading...Governor Charlie Crist should veto the property insurance legislation which passed (SB 2044) and has been presented to the Governor. He made a promise not to raise rates when he became governor. Many other politicians made similar claims about standing up to insurance companies, but they seem to have forgotten. These proposed laws not only raise rates, they take away coverage and benefits Floridians have enjoyed for a long time.
Continue Reading...Florida public adjusters have been served a huge loss in their ability to solicit and aid policyholders within 48 hours of a loss. A final judgment in Frederick Kortum vs. Alex Sink was issued on May 7, 2010. The ruling, in favor of the Department of Financial Services and upholding Florida Statute Section 626.854(6), reached my desk this morning.
Continue Reading...The Honorable Governor Crist:
I respectfully request that you veto the insurance legislation recently passed in SB 2044. While there are many good provisions in this bill including some of the Public Adjusting proposed changes, other provisions will cause great harm to Florida policyholders particularly when the next big storm or other perils impact already struggling Floridians.
Continue Reading..."Laws are like sausages, it is better not to see them being made."
-Otto von Bismarck
Our law firm's Knowledge Manager, Ruck DeMinico, was commenting to me that the new property insurance bill passed by the Florida House of Representatives yesterday was over a hundred pages long and that it would take a while to read through the entire document and analyze the changes from the last minute amendments. We joked that most of the Florida Representatives who voted on the bill had not yet read the entire bill either. Indeed, if they had read it, most would not understand what they were voting on because the complexity and subtlety of insurance law is not learned over several months.
Continue Reading...Policyholders know when they have been "ripped off" by the fine print of an insurance policy. The most common "rip off" is when insurance companies sell replacement cost insurance and then do not immediately pay replacement cost value. A number of insurance companies, like Chubb and AMICA do not play this "bait and switch" game in other jurisdictions. However, the insurance industry wants to change Florida law to make it legal in Florida.
Continue Reading...Senate Bill 2264 passed yesterday on a 37-1 vote, with Senator Rudy Garcia casting the lone "No." A corresponding bill must pass the House before the legislation can be sent to the governor.
Continue Reading...The Associated Press reported today that Senate Bill 2044 and House Bill 447 have stalled in the Florida legislature.
The article, published at Insurancenewsnet.com, states:
Continue Reading...Florida legislators will be debating insurance on the Senate floor today. The Senators are likely to have significant debate because recent indications are that there is extraordinary controversy about how to “fix" all of Florida's property insurance problems.
Continue Reading...(Note: This Guest Blog is by Kristin Demers-Crowell, an attorney with Merlin Law Group in the Tampa, Florida, office. This is part of a series that she and fellow attorney Donna DeVaney are writing on sinkhole issues).
I haven’t seen a ghost, but the new insurance legislation pending in the Florida legislature is almost as scary. There has been a flurry of activity in the Florida House this week regarding HB 447. The Florida Senate is considering a similar bill, SB 2108. It is helpful to review the Florida Senate Bill Analysis and Fiscal Impact Statement for an overview of the major reforms.
Continue Reading...A new Committee Substitute version of SB 2264 was filed yesterday. Attached is the new version of the proposed bill and the staff analysis on the version.
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These are actual photographs of damage to the ceiling and walls of one of my client’s homes. A carrier denied this sinkhole claim based on a report from an engineering firm that opined that the damage wasn’t caused by sinkhole activity. In addition to the numerous 2-4” wide openings to the walls and floors of the home, the floor elevation survey revealed a 7.25 inch floor elevation differential. Note that these photos show only a fraction of the actual damage to the house. Indeed, several veteran attorneys on both sides of the case and a well-respected retired judge who mediated the case all agreed that this was one of the worst sinkhole damage cases that they had come across.
Continue Reading...Insurance coverage disputes are often decided by laws and regulations made outside the insurance contract. Insurance companies have known this for years. They employ an army of lawyers and seemingly have an unending treasury to lobby for laws and regulations that favor insurance company interests.
Continue Reading...A Proposed Committee Substitute bill significantly impacting sinkhole claims was drafted over the weekend and has been filed this morning.
Continue Reading...This Property Insurance Coverage Blog set record visits last month. Thank you! I noticed a significant drop as the Easter weekend started. The Florida legislature took a well deserved breather last week as well. So, it seems like it is a good time to get caught back up.
Continue Reading...The question posed in this title was the headline to a post by the St. Petersburg Times columnist, Robert Trigaux. It was pretty harsh against some of our elected representatives who are neither running the insurance companies nor conducting these actions. Still, here are some of the significant observations in his post:
Continue Reading...The Florida House of Representatives appears to be following the lead of the Florida Senate regarding public adjusting. As noted last week in Amended Florida Public Adjuster Bill Passes in Florida Senate Banking and Insurance Committee, significant amendments to the original language of proposed legislation regulating public adjusters is moving through the Florida Senate. These amendments and proposed laws appear to be approved by committee action yesterday afternoon in the Florida House of Representatives. In my view, public adjusters should be prepared for these significant changes to become law because similar language is running simultaneously in both chambers of the Florida legislature.
Continue Reading...AAPIA’s lobbying efforts in the Pennsylvania Legislature have been successful. As I mentioned a week ago in AAPIA Defends Rights of Public Insurance Adjusters in Pennsylvania Legislature, AAPIA was lobbying against a proposed amendment that would make certain instances of neglect or incompetence a third degree felony. A new version of the amendment to Pennsylvania HB 1736 criminalizes only willful conduct and involves only certain serious violations of the statute.
The Florida Senate Banking and Insurance Committee passed an amended bill regarding public adjusters yesterday. It is different than the legislation previously proposed and noted Monday in Public Adjuster Senate Bill on Banking and Insurance Committee Agenda.
Continue Reading...The American Association of Public Insurance Adjusters (AAPIA) testified and presented an amendment to a proposed bill before the Pennsylvania House Insurance Committee yesterday. The bill was tabled to consider the proposed amendment. Gene Veno President of AAPIA made the presentation before the committee and reported that he:
Continue Reading...Florida Senate Bill 2264 has been set on the agenda of the Banking and Insurance Committee Agenda this Wednesday. This is the same legislation that was filed in the Florida House of Representatives as HB 1181.
Continue Reading...The Florida legislature is a difficult place to navigate. The place is an adult maze, and it takes effort to find the right room. Possibly, the logistics are a warning to novice citizens such as me that actually try to have some small input regarding the laws we agree to abide.
Continue Reading..."You gotta be kidding me" is probably being repeated by many after reading the title to this post. I wrongfully wrote about Representative Janet Long without giving her an opportunity to explain her concerns and longstanding advocacy for policyholders when she worked as a Deputy Insurance Commissioner in a Florida Department of Insurance Branch office. Before the spotlight of politics and public life subjected her to criticism without an ability to fully explain the purpose of the laws she proposes, her job in the Florida Department of Insurance required her to talk with and help policyholders upset about every imaginable wrong that could possibly befall an insurance consumer. I should have been more diligent in my research of her before jumping to conclusions about the framework for her views in this very public blog.
Continue Reading...Matt Gaetz is running for a seat in the Florida House of Representatives. His chances of getting elected have become better since former Governor Jeb Bush provided his endorsement to Gaetz. Here is Gaetz commenting on the endorsement:
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The poor policyholders whose homes cracked, popped, and dipped as a result of sinkholes induced by citrus farmers spraying their crops to prevent freezing damage should be happy it happened to them this year. Newly proposed anti-consumer sinkhole legislation would limit policyholders to 25% of their coverage limits for the most common sinkhole problems.
Continue Reading...The Florida Senate Banking and Insurance Committee has a number of very intelligent and very well meaning members. Two of them, Senator Rhonda Storms and Mike Fasano stood up yesterday to the insurance lobbyists who know little about insurance, but a lot about propaganda and politics. Full time and professional insurance lobbyists have one agenda--achieve their clients agenda. They have an army of lawyers, a ton of money, and their message is "spin" at its finest. No wonder so many public servants can get snowed by the misinformation and insurance industry proposed laws.
Continue Reading...If you are a policyholder, don’t expect prompt payment of replacement cost benefits and payments for damage to older roofs if Florida Senate proposed legislation passes. A proposed bill filed as a substitute that will be heard in the Florida Senate and Banking & Insurance this Wednesday was just released this afternoon. I have not had an opportunity to review it in detail, but a number of anti-consumer provisions are contained within this proposed legislation.
Continue Reading...(*Chip Merlin's Note: This guest blog is by Frank Artiles, candidate for the Florida State House of Representatives)
“Determine never to be idle…It is wonderful how much may be done if we are always doing.”
-Thomas Jefferson
Thank you for hosting a Forum that informs and educates so many regarding insurance industry trends and concerns. I feel privileged to work in a part of the insurance industry dedicated to helping people. I am humbled that you have asked me to write about a topic that is so important and that I feel strongly about.
Continue Reading...Some public adjusters were calling me asking about the recent proposed legislation of Florida House Bill 1181. This extraordinarily anti-consumer legislation was filed by a Democrat, Janet C. Long. My impression is that this legislation is a potential nuclear bomb for policyholders and public adjusters.
Continue Reading...As you read this post, consider these life lessons:
You can’t always get what you want
But if you try sometimes, well,
You just might find you get what you need
and
Continue Reading...DON QUIXOTE
Hand over that golden helmet!BARBER
But this is a shaving basin!DON QUIXOTE
Shaving basin! Know thou not what this really is?
The Golden Helmet of Mambrino!
When worn by one of noble heart, it renders
him invulnerable to all wounds!
(to the Barber whacking the barrel with his sword)
Hand it over!Thou Golden Helmet of Mambrino,
With so illustrious a past,
Too long hast thou been lost to glory,
Th'art rediscovered now at last!
Golden Helmet of Mambrino
There can be no hat like thee!
Thou and I now, ere I die now,
Will make golden history!BARBER
(aside to Sancho)
I can hear the cuckoo singing
In the cuckooberry tree...
Amy Bach and others with United Policyholders provide a longtime and steadfast consumer protection organization devoted solely to the interests of policyholders. With extensive experience and appreciation of how much legislation can impact insurance coverage and claims, Bach provides a unique perspective with expertise on a national level concerning insurance policy and insurance regulation. Policyholders need more Amy Bachs to counteract the extraordinary coordinated efforts by insurers to make laws and regulations one sided in the insurers favor.
Continue Reading...The Florida legislator is full of "flip flop" legislators that are reversing laws made in 2005 and 2006 which supported lower insurance rates and protected insurance consumers from unscrupulous insurers. Governor Charlie Crist ran on a platform of helping Floridians keep insurance rates down and he is sticking to that promise even as other politicians who once voted for such laws are now firmly supporting the opposite measures. These "flip flop" politicians are filing laws that would allow rates to go as high as the insurance industry can make them and laws that take benefits away from consumers following disaster. Crist seems to be standing tall against the insurance industry and for the people, unlike other politicians who are currently getting their responses and "speaking points" from insurance lobbyists.
Continue Reading...Three consumer advocates published a letter, Property Insurance Deregulation Too Costly, which claims that currently proposed Florida legislation calling for no regulation of insurance rates is bad for Floridians "because the average consumer does not have the resources or information to determine when a rate is excessive, the opportunity for the [insurance] company to abuse consumers exists." I agree, and for many more reasons than just that.
Continue Reading...I appreciate all the comments to posts from readers with various perspectives on insurance coverage and the insurance claims industry. I read them all, try to respond when I can, and honestly consider the viewpoint of those writing. This morning, I came across a comment worthy of consideration by all of us regarding mediation and alternative approaches to insurance claims dispute resolution.
Continue Reading...Why do so many of our politicians play to the lobbyists and support laws that harm the average person and voter? This is exactly what has happened with important laws sponsored by the insurance industry lobbyists and then proposed by Florida Senator Mike Bennett of Bradenton and Representative Bill Proctor of St. Augustine. These politicians and other Florida political leaders have sponsored a law that would allow insurance companies to raise the rates of Florida policyholders as much as they want. Indeed, the law they support allows for insurance companies to collude with each other, since it calls for the complete deregulation of rates. As the insurance industry is exempt from anti-trust regulation, based on a bargain it made with the federal government in which it agreed to state regulation of rates, the insurers would be legally exempt from all regulation. Is this stupid or what? Do the Florida political leaders supporting this law think people will be happy when their rates go up 100% in a couple of years, or is this just a payback to the insurance industry and their lobbyists funding certain political action committee dollars? Or, giving them the benefit of the doubt, do they really understand the issue?
Continue Reading...The appraisal clause should not be removed from Florida insurance policies. The concerns of insurers and policyholders can be addressed if we simply do two things:
1. Mandate that the appraisal clause remain in all property insurance policies.
2. Pass legislation which provides the safeguards for a fair procedure while allowing the parties to make the process as formal as they need to insure due process and still reflect the desire to avoid the time and expense of litigation.
Continue Reading...Miami Herald reporter, Bea Garcia, wrote a very important story, Tackling Contentious Insurance Issues, concerning Insurance Consumer Advocate Sean Shaw. It appears the Roundtable meeting I wrote about in Alternative Resolution Roundtable: Appraisal is the Hot Topic and Is There Any Chance that Appraisal Will Stay the Same in Florida?, is going to be an important last meeting before Shaw takes stances on how Florida legislators should deal with current insurance consumer issues:
Continue Reading...In a post last September, State Farm Agents are Fighting State Farm for Economic Survival, I wrote:
"Again, for many different reasons, I hope McCarty and State Farm can work out a deal."
Continue Reading...Floridians currently have legislators that are in the pockets of and doing business for insurance companies. Virtually all states regulate insurance rates because insurance companies have been historically notorious for over charging customers following losses, as well as for under charging customers before declaring bankruptcy.
Continue Reading...I wonder how our clients, the Leeds, would feel if they had purchased only catastrophic sinkhole coverage or no sinkhole coverage, rather than the normal sinkhole coverage required when they purchased their "all-risk" insurance policy. Their home slowly but surely cracked, drooped, and sank over several years before it was condemned. If they "saved" money on their premium as Florida Senator Mike Fasano successfully pushed for in legislation, they would have lost the entire investment on their home. They would also still owe money on the mortgage, possibly causing bankruptcy.
Continue Reading...A lawsuit was filed in Leon County Circuit Court yesterday challenging the 48 hour solicitation ban on public adjusters. Last month, we posted Florida Public Adjusters File Lawsuit to Overturn 48 Hour Solicitation Ban and Fee Caps, reporting on the first of these two similar lawsuits. The second lawsuit is different in that it focuses solely on the 48 Hour Ban on solicitation, where the first challenges the fee caps enacted by the Florida legislature.
Continue Reading...Imagine if we had truly knowledgeable advocates for insurance consumers in our legislatures. Many politicians advertise they are for policyholders as election day approaches, but they refuse to push any agenda other than the insurance industry’s the rest of the time. In Florida’s past legislative session, Florida Senator Don Gaetz, sponsored three significant pieces of insurance consumer legislation protecting the rights of policyholders regarding the fair treatment of claims. The person helping to write that legislation, his son Matt Gaetz, is now running for the Florida House of Representatives and he deserves support from those who want strong laws protecting Floridians from slow, frustrating, and wrongful insurance claim handling.
Continue Reading...A lawsuit was filed by three public adjusting firms seeking to enjoin the State of Florida from enforcing the 48 hour solicitation ban and the fee caps public adjusters may charge to policyholders. The mastermind behind the lawsuit is lawyer turned public adjuster, Pat Catania of East Coast Public Adjusters. The lawsuit is not a surprise. Many public adjusters have been complaining that their business has been significantly impacted by these laws as insurance restoration companies act as surrogate public adjusters since the 48 Hour Ban does not prohibit insurance contractors from actively soliciting work from policyholders immediately after a loss.
Continue Reading...Where are our insurance consumer advocates? Are they publicly wanting to appear one way to get their constituents’ votes, but then voting another way behind closed doors? This is my concern, because otherwise the last bill placed before Governor Crist would never have appeared. My powerful, worthy, much richer, and able State Farm lobbyist, Mark Delegal and other similarly powerful interested insurance industry lawyers show how the insurance industry has already set out its agenda on the insurance consumers of Florida in a recent article:
Continue Reading...Dan Luby of the Florida Insurance News forwarded a Blog, Alex Sink's Cold War with the Insurance Commissioner, by Gary Fine regarding a possible “riff” between Alex Sink and Kevin McCarty. I find this curious because the two of them are leading consumer advocates for policyholders. I have never found Bill McCollum, Sink’s opponent for Florida Governor next year to be a supporter of policyholders. He is clearly the insurance industry’s candidate. Yet, the Blog noted:
Continue Reading...“Interestingly enough, Attorney General Bill McCollum - and Sink's likely rival for the governor's office in 2010 - praised McCarty's report, saying that Floridians should be "very pleased" with the amount of surplus lines coverage since it has helped decrease the need to have commercial coverage picked up by state-created insurers.”
"Cheaper" insurance rates often mean far less coverage. In this world, you often get what you pay for. If there is ever a lesson to be learned about that, just ask those that live in the "Sinkhole Capital of the World," Pasco County, Florida. They can elect to get "Catastrophic Sinkhole Coverage" as ordinary coverage or get "Sinkhole Coverage" which is every bit as catastrophic where it counts--the ability to get back to where you started from--but covers damage from a slow moving sinkhole. The latter optional coverage is very expensive and covers Floridians from loss caused by most of the sinkholes that occur. The other coverage, which is much less costly, covers only very quick and substantial collapse sinkholes which happen once in a gazillion years to the properties owned by anybody. Guess which form the insurance industry wants to insure? BINGO!
Continue Reading...Imagine if our legislatures had truly knowledgeable insurance consumer advocates. Do you think the insurance industry would have tried to pass laws in Texas and Florida that allowed insurance rates to unfairly rise or allow immunity for wrongful conduct after a loss occurs like TWIA is attempting in Texas?
Continue Reading...Amy Bach of United Policyholders commented on yesterday's post, The Obligation of Good Faith Claims Handling and Policyholders' Perceptions of Why it Does Not Happen, She wrote:
Continue Reading..."As usual, great point Chip. I helped write and pass a law in California that allows claimants to obtain claim related documents during the adjustment process. We tried to get a similar law passed in Louisiana after Katrina - and I've been thinking this would be a good concept to work on exporting nationwide...."
The Florida legislature passed a law prohibiting Public Insurance Adjusters from soliciting business within 48 hours of a loss. Obviously, the lobbyists for the insurance industry were overjoyed with this law’s passage because it effectively allows the insurance companies and the insurance restoration industry to set the tone of the adjustment, without the typical policyholder having access to professional help.
Continue Reading...Yesterday, we filed an amicus curiae brief on behalf of United Policyholders in the Florida Supreme Court. This type of legal argument is often called a “Friend of the Court” brief because it is not filed by a party to the lawsuit, but it is filed by a person or entity with an interest in the outcome of the case. In theory, amicus briefs provide courts with information needed to reach the right decision. Usually, amicus briefs address the public policy or state or nation wide effects of a legal decision, while the parties to the case focus solely on how the outcome will affect them.
Continue Reading..."Should I Stay or Should I Go?" I imagine the State Farm claims employees and agents must be playing these classic lines from The Clash over and over. According to an article in yesterday's South Florida Sun-Sentinel, there is some speculation State Farm wants to stay and may try to politically strong-arm Florida into allowing it.
Continue Reading...There is no place for fraud by a policyholder or public insurance adjuster when reporting a loss to an insurance company. At this week's Florida Association of Public Insurance Adjusters (FAPIA) summer conference, our law firm emphasized this message. Like insurance company and independent adjusters, public adjusters are bound by ethical standards. I was happy to see that the FAPIA leadership made ethical and professional behavior a prominent theme of discussion at the conference. Both policyholders and the insurance industry can benefit greatly from increased emphasis and enforcement of public adjuster professional and ethical standards.
Continue Reading...Governor Charlie Crist just vetoed HB 1171, which was euphemistically titled the "Consumer Choice Bill."
Continue Reading...I do not know why the State Farm Florida President would write a letter to Governor Crist telling him State Farm will remain in Florida if Crist signs the bailout bill. Of course it would. What a competitive advantage a few large insurers would have over the rest of the domestic competition.
Continue Reading...The Insurance Journal ran an article, Florida Domestic Insurers Urge Veto of 'Dangerous' Deregulation Bill, which indicates a significant portion of Florida's insurance industry opposes State Farm, State Farm agents, and the other big insurers trying to get a competitive advantage from this legislation. The article outlined many of the competing views and stated in part:
Continue Reading...I received an email from a right wing group that has ties to the insurance industry. It is a call to lobby Governor Crist to support State Farm's bailout legislation. Every consumer group I know of has called the bailout another giveaway to the insurance industry at our expense. But the insurance propagandists are still pushing their illogical arguments.
Continue Reading...Governor Crist has signed the flawed Surplus Lines Bill (HB 853) into law. The story was reported today by the Insurance Journal in an article, Gov. Crist Signs Florida Surplus Lines Regulation Bill:
Continue Reading...Have you ever visited one on one with an elected legislator for more than 30 minutes? I have a number of times, and the results are mixed. Yesterday, I had a surprisingly pleasant and rewarding experience talking with Mike Fasano, a Florida Senator.
Continue Reading...One way to get cheaper rates is to buy an insurance policy that covers nothing. An article shows this is how the Florida legislature is tackling the insurance rate problem:
Continue Reading...The Texas Windstorm Insurance Association (TWIA) has a new operations plan and laws that affect it, assuming Governor Perry signs the legislation. The good news for TWIA policyholders is that the consumer protections of Chapter 541 are still in place. The bad news is that I predict rates are going to increase substantially.
Continue Reading...The Consumer Advocate for the Florida Public Interest Research Group, Brad Ashwell, wrote a letter published in the Gainesville Sun calling on consumers to urge Governor Crist to veto the State Farm bailout legislation. He clearly explained how the bill will harm Floridians:
"The problem is that this bill would remove consumer protections by no longer allowing the OIR to protect Floridians from excessive or discriminatory rate hikes as Kevin McCarty and his office have successfully done time and time again.
If HB 1171 becomes law, major insurance carriers would not only be able to charge whatever they like, they would also be able to game the system by manipulating rates, quoting excessive premiums to coastal homeowners, then dropping those policies if they choose to so they can maintain and grow inland policies where there is less exposure. The lack of predictability this would create is exactly what we don’t need in a state with an already fragile and overstrained property insurance market.
And perhaps the most troublesome provision is that the bill would help further grow the surpluses of these larger insurers while preventing small Florida-based carriers from doing the same. In this way the bill aims to provide an unfair competitive advantage to larger companies by discouraging across the board competition with smaller carriers. This would ultimately harm consumers and businesses by fostering an insurance market offering fewer choices in terms of dependable insurers. It’s also important to recognize that there’s no guarantee these large companies will continue writing policies in Florida.
Rather than deregulating the market, which hasn’t worked out in the past, we should be working on policy goals that support a more competitive insurance market that provides consumers with more affordable options. In short, we need more Florida-based companies competing, not fewer large insurers who dominate the market, essentially holding homeowners hostage, charging any rate they choose."
He is right, and nobody disputes his facts. Proponents of the bill argue it gives consumers the “choice” to pay excessive rates if they want. The legislators who voted for the bill did so because of political pressure, without understanding the consequences, or because they like the incentives offered by insurance companies for their votes. Either way, the “choice” is just a way to justify this bad legislation.
Another day, another twist as the TWIA / Windstorm bill winds its way through the Texas legislature.
In its latest incarnation, the Windstorm bill, now found in HB 4409, does not contain the language that would have stripped consumers of the ability to bring an action under Chapter 541 against Texas Windstorm Insurance Association (TWIA) for wrongfully denying or delaying payment of claims.
Continue Reading...There has to be a better way for Texas to make laws. Well meaning people who become legislators generally want to make things better. It is obvious that the Texas legislature is not functioning in a way that allows good intentioned people to make good law.
Continue Reading...What happened to the time when a significant insurance coverage decision arrived and everybody in my line of work analyzed that topic for several years? Now, the insurance industry is writing so many new and differently worded forms, it is hard to rely upon case decisions as being of widespread significance. If a case decision is made which insurance companies want to avoid, they re-write the policy or the insurance industry lobbies legislators to change the statutory law "gaming" the insurance business to outcomes predetermined in the insurer's favor. Accordingly, I spend more time researching trends of politics. I also review insurance trade journals to contemplate how my policyholder clients may be impacted.
Continue Reading...An article in the Austin American Statesman, Late surprise: Windstorm insurance passes, provides insight regarding the ethics of some in the Texas legislature. Most would agree that laws and rules are to be followed, but maybe that does not apply to the Texas Senate:
“By Senate rules the vote was to have occurred before midnight Wednesday, but a Senate sergeant at arms unplugged the clock at the back of the Senate just before midnight.
By a 27-4 vote, senators voted to amend House Bill 4409 to include the provisions of Senate Bill 14, that was passed in April to address the looming crisis in the Texas Windstorm Insurance Association.
“This is our last hope to be able to work on this issue,” said state Sen. Mike Jackson, R-LaPorte, the Senate sponsor of the House legislation.
For nearly a half hour, during the debate on the issue, the Senate clock read 11:58.”
Our understanding is that the anti-consumer language is not included, but the version on the Web site has the bad language and struck the consumer protections. It is buried at page 47 of 84 of the pdf version. We will keep those in Texas posted on the bill.
The Texas legislature has its hands full this week with an omnibus biill regarding TWIA. Florida Governor Charlie Crist has to decide whether to veto various measures regarding insurance legislation. Additionally, three federal bills were just filed which may impact the landscape of how insurance is made available and sold.
Continue Reading...The politics of insurance is tough for consumer champions. The insurance lobby has many faces and methods of forcing its position. In Florida, the dirty campaign against those governmental officials who stand up to State Farm and the big insurance industry has begun in earnest. Florida has one of the most respected insurance commissioners in the country, Kevin McCarty. Mike Bennett, a relatively unknown state Senator, is attacking McCarty simply because McCarty voiced the opinion that Bennett’s insurance “choice” bill would hurt Floridians.
Continue Reading...After reading what actually passed, the House Committee seems to have struck all of the Senate language concerning 2210.552, and then added a new subsection (on page 36 of its 51 page bill) which reads :
SECTION 40. Section 2210.552, Insurance Code, is amended by
adding Subsection (e) to read as follows:
(e) Notwithstanding Subchapter H, Chapter 74, Government
Code, or any other law, an action brought under this section may not
be transferred by the judicial panel on multidistrict litigation.
Maybe the calls and messages paid off. Maybe policyholders just got lucky. The important activity for now is to make certain that legislators know to keep it this way.
Stay tuned for developments.
The legislative process has been called something akin to watching sausage being made. In Austin last night, it was very old and molded meat as the ingredient. The story was reported by the San Antonio Express News:
Continue Reading...This morning’s post, Proposed TWIA Law Smacks Hurricane Ike Claimants, deserves follow-up and some suggestions for action. I am no politician, but I encourage everybody to participate in our process of government. It is the American way, and I am convinced that many positive changes happen because some of us speak our minds about important matters.
Continue Reading...Why do some elected representatives kick the people who voted for them and pander to insurance companies? Tina Nicholson forwarded me a bill that has passed the Texas Senate that guts all consumer protections for TWIA policyholders.
Continue Reading...Imagine – all kinds of legislation, hand in hand with lobbying and political positioning, just in time for the start of hurricane season on June 1. A couple of recent news stories point out the possible direction that several key measures may be heading.
Continue Reading...A former insurance defense attorney called me yesterday, asking if I would represent him and his wife in their sinkhole insurance dispute. While he oversaw many sinkhole matters from the insurance company's position, I guess he knows that a lawyer who represents himself has a fool for a client. His call to me is part of a trend, sinkhole loss calls to our Tampa office have been on the rise. Last week, the St. Petersburg Times ran a front page lead article, Geologists Worry About Drought's Effects on Sinkhole Season. The insurance coverage available, various statutory changes, caselaw, science, and repair of sinkhole losses make these cases fairly complex. Extreme rains or droughts seem to make sinkholes more frequent.
Continue Reading...I am an advocate for insurance policyholders. I am accountable to them. Our firm accomplishes the results they expect through a "can do" outlook, innovation and the timeless All-American mother of most success-- hard work.
I was imagining what it would be like to make a living as an insurance industry lobbyist. Lobbyists are usually lawyers or staffers that go by a title such as a "governmental affairs assistant." Some are the directors of various insurance trade organizations. Insurance companies measure their lobbyists’ accountability in a different way.
Continue Reading...Imagine if the only way politicians could raise campaign money was from the people who could vote for them. Until that happens, the insurance industry, which is among the strongest lobbying powers, will continue to influence otherwise well meaning public servants into making laws serving only insurers. Thank goodness there are a few independent consumer-centered public service groups with expertise to take on the sophisticated and well funded insurance lobbyists and their lawyers.
Continue Reading...The Florida Consumer Action Network (FCAN) has urged Florida Governor Charlie Crist to veto recently passed legislation that would allow insurers to raise rates without approval by the Office of Insurance Regulation. FCAN is probably Florida’s largest consumer action group. The Bradenton Herald quoted foes of the legislation who refer to the bill as "the State Farm bailout bill." I agree.
Continue Reading...As I noted in a blog post last week, House Bill 853, legislation intended to exclude surplus lines insurance carriers from an entire Chapter of the Insurance Code, was poised to pass both chambers of the legislature -- with only the hope that time would run out before they could agree on the wording.
Continue Reading...Numerous newspaper articles have discussed this session’s bills which impact the insurance industry. The anti-consumer bill, which provides for deregulation of insurance rates, passed. I expect Governor Crist will veto that bill as was previously reported.
Continue Reading...Florida Insurance Commissioner Kevin McCarty is working tirelessly for fair treatment of insurance consumers. It is amusing that the Florida legislature may give into State Farm's bullying and even allow higher insurance rates, which McCarty says are unnecessary. Some of our legislators are pandering to State Farm and the Florida insurance industry by using the usual "word spin" games. Deregulating rates under the guise of "consumer choice" will simply lead to higher premiums.
Continue Reading...Richard Dietz, a former claims supervisor with Farmer's Insurance Group, has taken to the airwaves to confess the sins of his former employer, co-workers and himself. His video is being broadcast in the state of Washington in support of a consumer protection referendum which would provide financial penalties for insurers that wrongly delay or deny claims.
Continue Reading...I wrote about surplus lines insurance companies in an earlier post, Surplus Lines Insurers, Sinkholes, and the Law of Mars. I explained how an attorney in our firm, Donna DeVaney, was able to get a favorable ruling in a sinkhole case involving a surplus lines policy due to a recent Florida Supreme Court case, Essex Ins. Co. v. Zota, 985 So. 2d 1036 (Fla. 2008).
Continue Reading...Most insurance opponents find it amusing when I explain how many places I have been in a week. If they only knew how many matters I have "touched" in a day they would fully appreciate how hard I work to protect policyholders. This morning at breakfast, a Zurich attorney asked about my daily schedule and I responded as I normally do, that I am "busy." The truth is that I was up at 5:45 am, in Tampa, flew to Destin, Florida, and picked up a client which lead to strategy on her case, then on to New Orleans where I met with new potential clients, met with the Zurich counsel, went to a Condominium Conference, worked on the paperwork of a seven figure hotel settlement, etc.,---- I am in the "muck" of insurance disagreements and want to help, which is why you should listen to the following suggestions.
Continue Reading...Most of the time, I battle large corporate insurers in David vs. Goliath like battles. I find it amusing that State Farm's attorneys are struggling in this fight, given State Farm’s enormous size and power. Today, State Farm's lawyers, lead by the very able Mark Delegal, are lobbying Florida's leaders on a very anti-consumer bill. This bill would allow State Farm to charge whatever rate it wants. Florida Governor Charlie Crist is reportedly prepared to veto such legislation.
Continue Reading...The April 6 Edition of BestWeek ran a story, Insurers Have Faith in 'Bad Faith' Victories, which indicates insurance companies are winning the legislative battle against consumer protection statutes. The story notes that the insurance industry's lobbying propaganda claims that consumer protection statutes make insurance more costly at a time when people can least afford it.
But how affordable is "cheap insurance" that does not pay or pay on time?
Insurers are using the premiums paid by their customers to sponsor pro-insurance industry laws that do not hold insurers accountable when they wrongly delay or deny payments. The same premiums pay for lobbyists to do everything they can to defeat proposed legislation that provides meaningful remedies to customers who have been harmed by an insurer's shoddy claims practices.
Last year, Washington passed laws that made it unlawful for insurers to "unreasonably" deny insurance claims, and allows treble damages when an insurer does so. The Washington Insurance Commissioner stated "the law is encouraging insurers to be more responsible."
What those insurers want are consumer protection laws with no teeth. They want illusory laws that mandate "good faith" claims handling without meaningful accountability. That type of law would be akin to prohibiting murder, but not giving the police the power to make an arrest.
Honest insurers and those that act in good faith should have no problem with strong consumer protection laws. Those companies already play by the rules. The only reason insurers would lobby against strong consumer protection laws is because they want to cheat their customers. This forces otherwise good and honest carriers into dishonest practices so they can compete. A legal system that fails to hold entities and people accountable for breaking rules is tantamount to a society without rules.
If you love dealing with your group health insurance bills and claims, you will be overjoyed with the new legislation proposed in Congress allowing property insurance companies to apply for a Federal Charter. This proposed legislation is the most unfair and anti-consumer federal legislation filed in recent years.
Continue Reading...We all know that the insurance industry is one of the biggest lobbyists around. However, as Brian Albright’s recent article, New legislation challenges ‘bad faith’ claims practices, notes, New Jersey, Connecticut and Montana are considering legislation that significantly improves consumers’ legal rights against insurers who act in bad faith. Colorado is considering legislation that could prohibit insurance companies from rewarding employees for making claims determinations against their customers. Let’s hope this is a trend, and that legislators throughout the country find the integrity to enact similar legislation.
Mark Phillips recently posted a comment in Surplus Lines Insurers, Sinkholes, and the Law of Mars, which would probably terminate his employment as an adjuster for telling the truth if he were still an Independent Adjuster:
Continue Reading..."I handled numerous loss adjustments for a South Florida MGA broker who had arranged his own "excess surplus lines" authority overseas. Due to this flexible "hand-shake" authority and with his own customized and approved manuscripted policy designs, he was actually controlling the underwriting data and policy issuance. He was bold and daring enough to "check off" certain boxes misrepresenting building characteristics and histories inaccurately on applications, so that, at time of loss investigation he could promptly deny coverage when it was noted in the adjusting routine that certain building events and maintenances had not occurred as were required to be validated in order to acquire the policy coverage and issuance. He could thus accurately void the contract on grounds of misrepresentation, and have the underwriting questionnaire in the file to back up the denial. His incentive was of course to sustain his flexible contract arrangement and limit his loss ratios, thus enriching his commission contingencies. Worth noting is that many of the insureds represented a class of Hispanic consumers who had no ability to know what was authentically being stated on their final application and were thus caught by surprise when struggling to communicate in English, back to me the adjuster, that they had not confirmed certain property realities that had been "checked off" on their application.
Another compromised policyholder left at the curb."
Recently, our firm has been questioned about the appraisal of Hurricane Ike claims. Appraisal is an informal process which determines the monetary amount of disputed damage claimed under a property insurance policy. Questions have come from policyholders and public adjusters regarding a variety of issues.
Continue Reading...Mississippi State Senator David Baria admitted that his proposed legislative bill of rights for policyholders is "dead." Mississippi S.B. 2196 would have eliminated anticoncurrent causation exclusionary language from property insurance policies. The Mississippi Senate Insurance Committee failed to act on the bill, thereby killing any attempt to enact a bill of rights.
Unlike other states, the insurance industry dominates Mississippi's Republican party. Accordingly, I was not surprised when the Mississippi Senate killed the bill. Until the Mississippi Republican party frees itself of the very anti-consumer mind set of insurance industry lobbyists or Mississippi changes the balance of power back to the Democratic party, it will be very difficult to achieve meaningful insurance reform there.
Mississippi Insurance Commissioner, Mike Chaney, has his own regulatory version, which is supported by the insurance industry. Julie Pulliam, the director of public affairs (a lobbyist manager) for the American Insurance Association thinks Chaney's "Policyholder Bill of Rights" strikes the right balance. The one thing I have learned from going head to head in politics with the insurance industry is if they think something is the "right balance," then it is bad for policyholders.
It appears that the insurance lobby may have a friend in Mike Chaney. It is obvious they have strong allies with the Mississippi Legislature. It is a shame that some of the nicest people and many lifelong friends have leaders so committed to helping an industry forcefully against their long term economic interests. It makes little common sense. But again, that's politics.
"Merlin is just on a 'fishing expedition' seeking these emails, your Honor." Similar phrases are argued by insurance counsel all the time when our firm is trying to get to the truth of what happened and, just as important, why something happened. In today's manner of doing business, the truth of many disputed matters is best found in emails. The contemporaneous history of emails between individuals is often the best record of the logic and thought processes leading towards action and decision. If I were representing insurers with corrupt or wrongful claims practices, I would argue against turning over those emails as well---why would anybody hide emails that proved innocence?
A recent Order in Citizens for Responsibility and Ethics in Washington v. Executive Office of the President, highlights why emails are so important. The Court stated:
"I have always begun with the premise that, as just indicated, the emails that are said to be missing are the very heart of this lawsuit and there is a profound societal interest in their preservation. They are, after all, the most fundamental and useful contemporary records of the recent history of the President’s office. If Napoleon was right when he said that he did not care who wrote France’s laws if he could write its history, then the importance of preserving the e-mails cannot be exaggerated." (emphasis added)
Modern insurance companies operate through emails. Company goals, management initiatives, discussions, reflections on performance, actions and history of activities are substantially recorded in emails. Judges in insurance disputes should quickly and, as a matter of routine, dismiss the "fishing expedition" arguments by insurance company attorneys. It has been our experience that many insurers, knowing what those emails say, are much more inclined to discuss settlement and quickly resolve cases when insurance company emails are discoverable. If judges in insurance disputes do not permit acces to emails, there is far too great a temptation for insurance companies to re-write or sanitize a claims history.
The Tampa Tribune ran an editorial on January 12th regarding the Citizens Mission Review Task Force. As usual, I had something to say about their opinion, and wrote the the following reply, which was published in Sunday's paper:
Florida Dangerously Vulnerable
This is in response to the Jan. 12 editorial, "New Ideas Could Bring Sound Hurricane Coverage."
You raise some important points regarding the safety net of property insurance, and the Citizens Mission Review Task Force meetings also revealed issues that all Floridians must be made aware of.
First, dried up credit markets have left our current system dangerously vulnerable. In the event of a major hurricane season, it is unlikely that Florida would be able to raise the money needed to cover the debts of Citizens through bond sales.
Second, as you noted, Citizens rates are currently lower than being actuarial sound. Yet everybody wants rates to remain affordable. The task force recommended responsible, capped increases to prevent wallet shock.
Third, encouraging a private insurance market to replace those carriers that find Florida too risky is a viable long-term solution. The Legislature passed laws aiding and regulating these companies that often provide coverage at rates lower than Citizens, especially for policyholders who take advantage of the My Safe Florida Home program.
Finally, the best long-term solution is to harden structures. Yes, it is costly but offering premium discounts to homeowners who make improvements has to be encouraged, even if it takes a state and federal tax relief program too beneficial to pass up. That is something our federal and state leaders can start working on now.
We cannot afford to put our heads in the sand and hope Mother Nature will spare us for another season. We must act now for the long-term because there is no easy short-term solution to the very difficult situation we all face.
WILLIAM F. "CHIP" MERLIN
Tampa
The writer is founder of the Merlin Law Group and was appointed to the Citizens Property Insurance Mission Review Task Force by Gov. Charlie Crist in 2008.
The final meeting of the Task Force is scheduled in Jacksonville on Thursday, January 22nd. Our Report is due to the Florida Legislature by January 31.
Most people do not look at their insurance policy until loss or damage forces them to. And most will agree that trying to find confirmation of coverage is not as easy as expected. Typically, insurance policies are very long and the various coverage provisions and exclusions can be confusing and sometimes ambiguous.
This scenario became glaringly apparent in the aftermath of Hurricane Katrina. Many policyholders found themselves in a very uncertain world, trusting solely on their relationship with their insurance carrier only to be denied coverage based on an exclusion they had never heard of. And oftentimes worse, many policyholders did not receive many benefits under their policy because their insurance adjuster did not inform them of the coverages and benefits available to them.
In an effort to prevent this unnecessary chaos in the future, several Mississippi lawmakers have recognized the importance of legislation to ensure that the citizens of Mississippi are aware of their rights as policyholders and informed of any exclusions in their policies that would be cause for denial of coverage. Unfortunately, these measures have not yet made their way to the Governor.
The Mississippi lawmakers started back in Session on January 6, 2009. We are in the process of preparing and pitching an Insurance Modernization Package to our lawmakers that will include, among other measures, a Policyholder Bill of Rights and other important legislation that will provide for timely payment of claims and penalties for noncompliance and unfair trade practices.
So far, this has proven to be an uphill battle in Mississippi, but one worthy of pursuing. The citizens of Mississippi are not insisting on anything that the insurance carriers are not already obligated to do in many other states across the nation.
In the typical, hospitable Mississippi fashion, Mississippi has focused on the needs of their business guests first. As Mississipians rebuild their beautiful coast, they are acutely aware of the need for a fair and balanced co-existence with their insurer. It is now time to focus on the needs of the citizens of Mississippi.
Stay tuned....we are in for a promising year!
There are some fights where you simply cannot sit on the fence. You have to choose what you stand for, who you want to help, and fight for what is right versus what is wrong.
You know that the people supporting you are "good" and the other guys--those that support cheaters and do not want to be accountable for their broken promises-- are simply "bad."
We have that fight going on in Mississippi as indicated in a story filed by Anita Lee. The Mississippi Policyholder Bill of Rights needs to be in legislation and regulation. It needs teeth. It needs to be enforced. Deborah Trotter has been leading our efforts to get something passed that is not a watered down form over substance piece of paper.
The problem is the insurance companies are very powerful "bad guys" when it comes to legislation giving their customers an even hand. Insurance companies are not people. They are mere fictitious entities filed under law. They do not breathe, bleed nor die. They can, and have, accumulated more money than most of people can imagine. By law, these fictitious paper entities are supposed to serve a public purpose. They agree to abide by laws required under licenses for which they voluntarily apply.
In Mississippi, there are people who will be "bought off" by the insurance companies. They are the insurance company lobbyists, lawyers, publicists, and employees that will do everything they can to prevent laws and regulations that support the rights of the insurers' customers. The insurers will influence patronage of bad public servants through donations and money. They have done this for a long time and have many supporters dependent on the largesse spread by the insurance support industry. These are the "bad guys."
This fight is not about the interpretation of a law or contract. It is not about how much an insurance rate should be or a lawsuit about whether a promise or duty has been violated.
This is a fight, like so many in different venues, where people are simply trying to make laws that force insurance companies to uphold promises and duties owed to the people that are to them, the customers. There can be nothing wrong with making laws that hold insurance companies accountable for breaking contractual promises and duties they agreed to abide by when getting their licenses.
Some of the interesting changes in the public adjuster trade are the increased requirements to obtain and maintain a license. This past legislative year, the Florida Association of Public Insurance Adjusters (FAPIA) lobbied for and obtained an apprentice period as well as specific continuing education requirements for public insurance adjusters. Some may be surprised that FAPIA pushed for this legislation, but there was an obvious need for it.
Continue Reading...Capitalism and economic venture are alive and well in the Florida insurance market. The Florida Underwriter reported this month that over 1.7 million policies have been written by new insurance companies since the 2004 hurricane season. As Allstate, State Farm and Nationwide retreat from the Florida property insurance market, these new insurance companies are accepting risks that would otherwise end up with Citizens Property Insurance Corporation.
Continue Reading...Florida Chief Financial Officer Alex Sink has claimed that the recent legislative session was favorable to consumers of insurance. It was, but it left a lot to be desired. While not noted as significant legislation, Senate Bill 2860 contains a renewed agenda concerning Citizens as a primary insurer versus an insurer of last resort. Private market advocates should be happy to see a commission has been established to study this. Personally, I think this is good and Florida should try to keep out of the insurance business as much as possible. "Free enterprise" is important and while government has a significant role regulating insurance, there is a definite difference between being the regulator and the government being the operator.
Continue Reading...Florida newspapers (Tampa Tribune, St. Petersberg Times, Sun- Sentinel) reported on the recommendations of the Florida Senate Select Committee on Property Insurance Accountability, a committee formed in response to the insurance industry misleading Governor Crist and the Legislature about rates during last years legislative session. Because of these misrepresentations Florida provided under-market prices for reinsurance and assumed greater risk in the event of a hurricane in return for lower rates. The insurance industry then raised rates after getting the favorable legislation. The letter from the Committee to Senate President Ken Pruitt contains significant and progressive recommendations to help consumers. A memorandum also indicated that the work of the Committee was not done and that the Select staff would be working with standing committees to help shape legislation protecting consumers. Finally, there appear to be some serious and well conceived changes to help insurance consumers. The big insurance lobbyists were not pleased, and that is usually a sign that something has been done to help the insurance customers -- all most large insurers seem to care about is return on investment, even dishonorably like they did last year. Even our governmental representatives have learned that you cannot trust big insurance.
Tuesday was a rather interesting day. Our firm helped win a $4.6 million dollar judgment for a panhandle Condominium Association last year. Citizens Property Insurance Corporation did not pay, as usual, but appealed. I argued the case [Citizens Property Ins. Corp. vs. East Pass Towers II Condominium, No. 1D07-2727 (Fla. Dist. Ct. App. oral argument Jan. 22, 2008)] for our client in Tallahassee, met with the Association representatives, and then made my way up the hill to the State Capitol where the Select Committee on Property Insurance Accountability was meeting. One of firm's lobbyists briefed me on the schedule and introduced me to some of the panel members I had not previously met. We wondered if the media attention and articles (Tom Zucco, No Auto for Allstate, St. Petersburg Times, January 17, 2008, at A1; Jerome R. Stockfisch, State Bans Allstate From writing any New Policies, January 17, 2008, Tampa Tribune) following last week's 0ffice of Insurance Regulation hearing would cause more attention to be focused on these proceedings.
Continue Reading...Earlier this year, the Washington State legislature passed an insurance bad faith bill that allowed for treble damages when an insurer was found to have acted unreasonably. Washington has never had punitive damages, so this legislation provided a significant remedy for policyholders damaged as a result of insurance company misconduct and a penalty for those insurance companies violating it. The Act also allowed the award of the policyholders' attorneys' fees. Immediately after Governor Christine Gregoire signed the bill, the insurance industry filed a referendum to have Washington citizens decide whether the Act would be struck down or upheld.
Continue Reading...Following the passage of recent insurance legislation, I wrote an op-ed piece for the St. Petersburg Times noting that Floridians are now a Hurricane Katrina away from financial disaster. Recently, the St. Petersburg Times and Miami Herald have run stories finding that our elected politicians have also come to the same conclusion.
Continue Reading...CFO Alex Sink and Governor Charlie Crist are still new to their elected jobs; this was obvious from statements made by Sink in her interview with the Miami Herald. In one statement, she astonishingly relates that it wasn't until last month, while driving along Ft. Lauderdale's Condo Canyons, that she realized how vulnerable Citizens Property Insurance Corporation and its insureds are in the event of a significant hurricane. She and Crist, among others, are clearly annoyed that the hopes for lower insurance rates have not materialized and are calling for an explanation and investigation.
Continue Reading...Two weeks after Alex Sink was sworn into office as Florida's new chief financial officer, lawmakers embarked on a 10-day special session to come up with ways of lowering insurance rates and providing some respite for the state's beleaguered homeowners. "I was still trying to find the ladies room," recalled Sink during an interview with the Miami Herald last week. The end result of the special session was the expansion of the Florida Hurricane Catastrophe Fund to $28 billion, allowing insurers to buy less expensive back-up insurance. This special session, in conjunction with more recently passed insurance legislation expanding Citizens, came with promises of savings to policyholders, with rate cuts averaging 20 percent or so. Six months later, the promised savings have not materialized -- as a matter of fact in recent weeks atleast five homeowner insurance groups have filed requests for rate increases. With more requests for rate increases inevitable, Sink, Crist, and other state officials are left questioning the viability of Florida's plan to reduce property insurance premiums.
It was recently reported by Paige St. John that the Florida Department of Financial Services is not keeping complete copies of consumer complaints (civil remedy notices) and insurance company responses. Instead, the Department's legal staff has determined that according to section 624.155 of the Florida Statutes they are only required to maintain two documents. One is the civil remedy notice and the other is the report of the disposition. Any other documents received (i.e. attachments, responses, etc.) are not part of their statutory duty pursuant to the Florida Sunshine Records laws or section 624.155 to be retained and are being discarded. Legal counsel having differing opinions about how to interpret the law is not new.
Continue Reading...Florida Farm Bureau Casualty Insurance Co. issued a homeowners insurance policy to the Coxes. The policy excluded any losses caused, either directly or indirectly, by flood or water damage of any kind. The Coxes' home sustained extensive damage caused by Hurricane Ivan and was determined to be a total loss due in large part to flood damage and in lesser part to wind damage. The Coxes demanded coverage, and Florida Farm tendered $12,000 for the windstorm damage. The Coxes declined the payment.
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