A rush to judgement?
Many readers said they saw me on television during this past Friday’s (March 14) 8am meeting of the Florida House Insurance and Banking Subcommittee. I intentionally sat in that chair not to be on camera but to sit next to an old friend from Speaker Daniel Perez’s office. My pal started in Governor Rick Scott’s administration and last I checked, he follows our firm’s work. I won’t share our exact conversation but in essence I gleaned the Speaker of the House, an attorney, is driving these hearings and there is a desired outcome.
Rep. Hillary Cassel at the Florida House Insurance & Banking Subcommittee Meeting, March 14, 2025. Courtesy, The Florida Channel
That desired outcome was unveiled the previous day on Thursday (March 13) in the debate surrounding HB 1551 by Rep. Hillary Cassel (another attorney, whose firm makes a living suing insurance companies), which would, for all practical purposes, restore attorney fee provisions as they were prior to our 2022 and 2023 legal reforms. The tone of the House Civil Justice and Claims Subcommittee meeting was hostile and angry with both Republican and Democrat legislators using terms like “villain,” and “hypocritical” when the discussion focused on the recent Tampa Bay Times article of insurers moving money to affiliates at the expense of company solvency and policyholder premium increases. The bill passed this subcommittee with one no vote. You can watch the over 50 minutes of discussion for yourself by moving the video counter to 1 hour and 11 minutes.
Florida Insurance Commissioner Michael Yaworsky testifies before the House Insurance & Banking Subcommittee, March 14, 2025. Courtesy, The Florida Channel
Now back to Friday’s emotionally-charged hearing. It was 3 hours, originally scheduled for 2 hours, with Rep. Cassel asking for two half hour meeting extensions. Florida Insurance Commissioner Michael Yaworsky and former Commissioner David Altmaier were the two speakers and of course the questions asked are telling. Some members were upset they never received the report by the Office of Insurance Regulation’s consultant that was the subject of the newspaper article, with Yaworsky and Altmaier saying the report was a draft and a final version was never completed. Yaworsky said insurance regulation was strengthened since the consultant’s report and that companies’ use of Managing General Agents (MGAs) helps incentivize investors to capitalize Florida carriers, providing a “countervailing balance.” You can read the News Service of Florida and the Tampa Bay Times accounts of the hearing to get a feel for it. A video recording of the hearing is available here.
Former Florida Insurance Commissioner David Altmaier testifies before the House Insurance & Banking Subcommittee, March 14, 2025. Courtesy, The Florida Channel
The hearing’s bottom-line: that the recently released report indicts the industry because it “proves” that insolvent insurers went bankrupt because affiliates took all the money, all the while the legislature didn’t know about the report’s 7-page summary. Nothing can be further from the truth and the facts are clear if we can get them across to legislators. Understanding how statutory accounting works in the insurance industry is tough, so we have work to do!
The House Insurance & Banking Subcommittee hearing is just the first of what’s expected to be a series of special meetings it holds to address property insurance companies’ accountability, profitability, and their affiliates and MGAs. The subcommittee meets again this Wednesday (March 19) and again Thursday (March 20) but there is no agenda yet for either meeting. So far, we’re not aware of any companies that have been invited to participate.
Not to anyone’s surprise, this is not the only insurance line of business that the trial bar is going after in this legislative session. They are pushing lawmakers to change a decades-old law that would lead to more medical malpractice lawsuits over patient deaths. The trial lawyers are doing everything they can to make sure their bank accounts grow, to the detriment of the consumer. For as their bank accounts grow, so do our insurance premiums. But they seem to have forgotten about that.
LMA Newsletter of 3-17-25
