A real estate and insurance agent weigh-in
I sat down recently with a long-time insurance agency executive and a top real estate agency owner who shared their ideas on which reforms would be most effective for lawmakers to achieve in the upcoming special session. We recorded our conversation for the latest episode of The Florida Insurance Roundup podcast.
Ron Assise, Senior Vice President of Horton Personal Insurance, in Estero, Florida, said his clients are experiencing “sticker shock” of 20% to 30% increases on their homeowners insurance premiums. He suggested the legislature approve what was in last session’s failed SB 1728, which would require a roofing deductible or an actual cash value or repayment schedule for older roofs, in place of the current full replacement value. “Doing that will really make it not worth its while to an attorney to go after an insurance company, if they’re going to get, let’s say 40 cents on the dollar as an example,” Assise said.
His other suggestions are to change the state’s 25% Roof Repair/Replacement Rule that requires an entire roof be replaced if 25% or more of it is damaged and ease existing material “matching” requirements in repairs, where a new roof is required if the repaired material can’t be matched with the rest of the undamaged roof. “The incentives go away for both the roofers and the trial attorneys that see big dollar signs when it’s most likely probably wear and tear or just a plain old older roof where someone should be taking care of the maintenance on their home like any other thing,” Assise said.
Whitney Dutton, owner of The Dutton [email protected]/Max First, a full-service real estate agency in Fort Lauderdale, said the same sticker shock is interfering with his clients’ ability to purchase a new home or stay in it. But he said such proposed policy restrictions would have to come with a lower policy premium cost. “I’m okay with it if the policy cost is relative to that type of coverage, but from what we’re seeing in the type of properties that I deal with, they’re writing the policies with a lot of those exclusions, water damage, restoration, and they’re not changing the price of them,” Dutton said. “The lower coverage isn’t what people are worried about. It’s the cost…and it’s being passed on unfortunately to the renters, too.”
Both Dutton and Assise agreed that what’s also needed is further reform of abusive Assignment of Benefit (AOB) contracts between homeowners and various contractors, roofers, and public adjusters. Both have had clients who had no idea what they had signed nor the aggressive tactics used against their own insurance companies in pursuit of a buck.
“The legislature is going to have to understand that this is going to come at a cost to somebody,” said Dutton, “and the attorneys in these larger law firms that this is all they focus on, they’re going to take a hit. So the legislators are going to have to have the political courage to stare down some of these big law firms who may donate to certain areas that they’re going to have to take a hit. And it’s going to have to come from top down, the legislator down,” he said.
The show notes on our podcast page include the Top 20 Attorneys Filing Property Insurance Lawsuits – 2022 Q1 that Dutton referred to. You can read more and listen to the full podcast here.
LMA Newsletter of 5-9-22