The fourth & fifth weeks of legislative committee meetings
Florida legislative committees were busy holding discussions and debate on various bills in preparation for the start of the 2020 Legislative Session on January 14. They’ll return for one more “committee week” on December 9. Included is a proposed 18-day “disaster preparedness” holiday (which is double the current length) where items ranging from weather radios to impact-resistant windows are exempt from sales tax – as an incentive to residents to “be prepared” for the June 1 start of hurricane season.
The only bill the legislature has to pass by law each year is the state budget. So far, 1,552 other bills have been filed. Here’s an update on a few of the ones we’re keeping an eye on for you – but the list will grow! Bill updates, as always, are noted in red font.
Assignment of Benefits (Windshield AOB) – This is the effort to reform growing AOB abuse in automobile windshield repair and replacements. It was part of last session’s broader AOB reform initially, but was dropped during negotiations on final passage of HB 7065 which became law in May.
HB 169 by Representative Richard Stark (D-Weston), an insurance broker, and companion bill SB 312 by Senator Linda Stewart (D-Orlando), a former insurance agent, would prohibit repair shops from offering gift cards and other incentives to motorists to file insurance claims. The Florida Justice Reform Institute released its latest Auto Glass AOB Data Update last week. Using Department of Financial Services’ data, it shows growth from about 400 auto glass AOB lawsuits in 2006 to 24,000 in 2017, with a leveling off last year to about 17,000 suits and holding steady for 2019. Orange (Orlando) and Hillsborough (Tampa) Counties are the most popular spots for such litigation, with 15 firms accounting for 90% of the litigation. One firm (Malik Law) is responsible for filing nearly 30% of all lawsuits.
SB 312 was scheduled to be heard by the Senate Banking and Insurance Committee last Tuesday but was tabled due to lack of time. The companion is HB 169 and has yet to be heard.
Insurance Claims Data – The bill addresses disclosure of, and defines a “loss run statement” as a report relating to risks maintained by an insurer which contains the history of claims occurring during a policy term. SB 292 by Senator Doug Broxson (R-Pensacola), who chairs the Banking and Insurance Committee. The bill unanimously passed the Senate Banking and Insurance committee last Tuesday. A similar bill in the House, HB 269 by Rep. Daniel Perez (R-Miami) passed unanimously the week before in the House Insurance and Banking subcommittee. These bills are still “evolving” with various suggested changes. “The overall effect of the bill is to establish a statutory framework for an insurance practice that routinely occurs,” states the bill analysis. As such, we find it odd that a routine practice needs to put into law.
Motor Vehicle Insurance (PIP) – This is a perennial effort to do away with Personal Injury Protection (PIP) coverage under Florida’s No-Fault insurance law and replace it with bodily injury (BI) liability coverage. Similar bills failed last session. Senator Tom Lee (R-Brandon) is back with SB 378 which currently has no House companion bill. The bill is awaiting its first hearing.
(See LMA Backgrounder: Personal Injury Protection for more details on the history of PIP reform and the failed 2018 bills, data, and past committee and stakeholder discussions.)
Motor Vehicle Rentals – Just as you can rent out your home when you go away on vacation, likewise your car, with online services such as Turo (https://turo.com/). HB 377 by Rep. Chris Latvala (R-Clearwater) would insert government intervention to regulate another sharing economy company advance.
In a nutshell, if a car owner parks their car at an airport for any length of time, a Turo user could “rent” that car and drive it until the owner returns from their trip. The bill provides financial responsibility & insurance requirements and a host of other regulations on this emerging idea/market. Of course, the traditional rental car companies are in favor of the legislation and Turo opposes, calling the regulations unnecessary. The bill is awaiting its first hearing.
Omnibus Insurance Bill – HB 359 by Rep. David Santiago (R-Deltona) has a variety of issues including an audit of the Cat Fund’s premium formula, requiring proper notice of a lawsuit including requiring the notice be mailed to the insurer’s address on file with DFS’ service of process unit versus a random address a plaintiff lawyer may find on the internet, and a host of other changes to insurance laws. Omnibus bills are aimed to be consensus bills with the aim to provide greater consumer protection including ways to drive down rate increases. Senator Jeff Brandes (R-Pinellas) is expected to file a Senate companion bill before the Senate’s November 22 bill deadline. The bill is awaiting its first hearing.
Insurance Guaranty Associations – Essentially a “Condo Parity Bill”, HB 529 by Rep. Jennifer Webb (D-St. Petersburg) would provide an increase from $100,000 to $200,000 per unit as the payout to condominium and homeowners associations. An identical bill SB 898 by Senator Joe Gruters (R-Sarasota) was also recently filed.
The Guaranty Association protects a traditional single-family dwelling for an up to $300,000 loss for the dwelling should the insurance company go bankrupt. The associations in favor of this year’s legislation argue that a total loss where a condo building is leveled would cost substantially more than $100,000 “per door” to rebuild and that the payout hasn’t been increased in over 30 years. This has been a point of conversation for many years and we look forward to the debate.
Another bill making its way through the process is HB 329 (also titled “Insurance Guaranty Associations) by Rep. David Smith (R-Winter Springs). This bill appears to tweak the major FIGA reform of several years ago in that it changes assessment calculations for both homeowners and workers compensation guaranty funds. It also proposes to change the way assessments are remitted. We are studying this bill in its entirety and encourage our readers to do the same to ensure no unintended consequences. The bill passed unanimously in House Insurance and Banking subcommittee on November 6 and is now in the Government Operations and Technology Appropriations Subcommittee. The Senate companion hasn’t moved.
Florida Building Code – SB 710 is in reaction to the destructive damage created by last year’s Hurricane Michael and other recent hurricanes. Sponsored by Senator Ben Albritton (R-Bartow), the bill mandates the Florida Building Code require that the entire envelope of certain buildings being constructed or rebuilt be impact resistant and constructed with high wind-resistant construction materials; requiring that all parts or systems of a building or structure envelope meet impact test criteria or be protected with an external protection device that meets such criteria; and provides certain exceptions. The bill is awaiting its first hearing.
(See Is Florida’s Building Code Protecting All of Us? and Why the Panhandle Wasn’t Hurricane Strong for Michael episodes for more details, from The Florida Insurance Roundup podcast.)
We also expect a “Sellers Flood Disclosure” bill to be filed this session, as Senator Jeff Brandes (R-Pinellas) has publicly expressed interest in this topic and his SB 150 (“Sanitary Sewer Levels”) would require a seller of real property to disclose any known defects in the property’s sanitary sewer lateral. The Miami Herald and others have reported that although current Florida law requires sellers and their real estate agents disclose known defects or anything that “materially affects” a property’s value, there are cases where someone bought not knowing they were in a flood plain or had suffered previous flooding. The idea has the support of the Federal Association for Insurance Reform (FAIR) and others in recent editorials.
While Realtors® are being targeted, can’t we get insurance agents to step-up? The piece that’s missing is the fact that insurance agents are not required to talk about flood insurance with their customers. Regardless of a home’s past experience or future flood propensity, insurance agents have a responsibility to TALK about flood insurance with customers at the time of initial property insurance policy issuance and on every renewal. A handful of agents do, but for those that don’t? The results are disastrous yet Florida’s law is silent when it comes to mandatory insurance agent documentation of a conversation with its customers. We hope FAIR can get behind this as well.
LMA Newsletter of 11-18-19
