There is a growing and deeply troubling trend in insurance regulation. It is not just about insurers protecting proprietary information. It is about insurers using “trade secret” laws as both a sword and a shield, keeping the public, policyholders, and increasingly, even regulators from seeing how claims are actually handled.
A recent investigative report by journalist Ron Hurtibise of the South Florida Sun-Sentinel, How Florida Property Insurers Keep Secrets From Policyholders, demonstrated with the state’s help, how Florida property insurers are using state-sanctioned trade secret protections to keep critical information hidden from policyholders. What makes this report so alarming is not simply that insurers are claiming secrecy. It is that the system appears designed to let them win almost every time.
The Sun Sentinel’s findings are stunning. It reported:
Other requestors have had no better luck. In a review of 93 cases filed since 2010 in Leon County involving Floridians who sought access to materials designated as ‘trade secret’ by insurers, the Sun Sentinel found no rulings denying insurers’ requests to keep their materials protected.
Ninety-three trade secret lawsuits, and the insurance companies have won each time. Think about that. In case after case, year after year, when policyholders or members of the public ask to see documents that may reveal how insurers operate, the courthouse doors effectively close. The result is a one-sided system where secrecy prevails, and transparency fails. This is not what trade secret law was meant to do.
Trade secret laws were designed to protect formulas, inventions, and legitimate competitive advantages. 1 They were never intended to conceal how an insurer treats its policyholders after a loss. Claims handling is not a secret recipe. It is the core performance of the insurance promise.
Yet, time and again, we see insurers labeling claims manuals, internal communications, training materials, and even claim file notes as “trade secrets.” The most important evidence of whether an insurer is acting in good faith is systematically kept out of view.
We have seen this play out before in dramatic fashion in a 2008 case involving Allstate Insurance and its Core Claim Process Redesign Program, often referred to as the McKinsey Documents. In the Allstate matter in Florida, the Office of Insurance Regulation attempted to investigate claims practices and subpoena internal documents. Allstate responded by labeling tens of thousands of documents as “trade secret,” withholding key materials, and resisting meaningful disclosure. The record shows that approximately 30,000 documents were marked as trade secrets, and many of the requested materials were not produced.
The regulator was left in an impossible position. Without access to the documents, it could not determine whether claims were being handled properly. The court ultimately recognized that this lack of transparency posed a danger to the public because it prevented meaningful oversight of claims practices. So, what happened? Florida’s regulator had to take the extraordinary step of suspending Allstate’s ability to write new business just to force compliance. 2
Today, insurers are not just resisting disclosure. Instead, they are proactively going to court to block it. In a recent case, an insurer sought a permanent injunction to prevent the release of its claim files, internal communications, and claims handling materials, arguing that these documents are proprietary trade secrets that must remain hidden from public view. 3
Let’s be clear about what that means. The documents that show how claims are adjusted, how decisions are made, and how policyholders are treated are being classified as secrets. If that position prevails and the Sun Sentinel data suggests it always does, then the public will never truly know how insurers operate and truly handle their claims. They hide behind the “trade secret” curtain.
The insurance industry will argue that disclosure would harm competition. But competition is not harmed by revealing whether claims are handled fairly and in good faith. Competition is not harmed by exposing whether adjusters are trained to minimize payouts. Competition is not harmed by transparency. What is harmed is the ability to quietly implement practices that reduce claim payments without scrutiny.
Insurance is not an ordinary business. It is a regulated industry because it serves the public trust. Policyholders pay premiums with the expectation that, when disaster strikes, the insurer will perform. Regulators exist to ensure that the promise is honored. But regulators cannot regulate what they cannot see. The public cannot trust what it cannot evaluate.
The Sun Sentinel’s findings should not be ignored. When 93 cases result in zero meaningful access, that is not balance. That is a system that has tipped too far in favor of secrecy. The law must change.
Trade secret protections should be narrowly limited to true proprietary information and not expanded to cover claims handling practices, internal manuals, and the very documents that reveal whether insurers are acting in good faith. Regulators must have unfettered access, and the public should have far greater visibility into the practices that directly affect them.
Because at the end of the day, insurance is built on trust. The public is increasingly losing trust in how the insurance industry is servicing its product when claims arise. That trust cannot exist behind a curtain of secrecy.
In addition to the attachments, those interested in this topic should read Secrets Behind the Curtain: How Insurers Are Using “Trade Secrets” to Hide from Regulation.
Thought For The Day
“Sunlight is said to be the best of disinfectants.”
— Louis Brandeis
1 Alan E. Wickman. Insurance Data and Intellectual Property Issues. Casualty Actuarial Society Forum. (Winter 1999).
2 Allstate Floridian Ins. Co. v. Office of Insurance Regulation, 981 So.2d 617 (Fla. 1st DCA 2008).
3 Olympus Ins. Co. v. Florida Department of Financial Services, No. 2024-CA-00338 (Fla. Cir. Ct. – Leon County).
