For Immediate Release: April 23, 2010
Contact: Vicki Twogood 850.413.5923
TALLAHASSEE — Florida’s Insurance Consumer Advocate Sean Shaw applauds Senator Ronda Storms’ amendment to Senate Bill 2044. Amendment 267518 would ensure that Florida’s insurance consumers, who have experienced a loss, are not further victimized by undue hardship in the replacement of their personal property. The amendment would further ensure prompt payment for the repaired property.
Senate Bill 2044, before the amendments, would change a law adopted by the Legislature in 2007. This legislation corrected unfair insurance practices that prevented Florida’s families from being able to recover insurance proceeds to replace their personal property. Current law simply requires insurers to pay full replacement cost for repairing and replacing damaged property that is insured under a policy that provides replacement cost coverage.
Consumers found themselves with the financial burden of assuming the replacement costs for personal property, especially if they did not have pictures or receipts and could not prove the loss of basic furnishings and clothing. Senator Storm’s amendment provides for replacement costs upfront to allow consumers to replace their lost personal property on a schedule that works for them, relieving consumers concerns about replacing seasonal items such as clothing, decorations, etc.
There were even reports that insurers required that the items had to be identical, for example an oak table was not a reimbursable replacement for a cherry table or a loveseat for a sofa. These types of situations prompted the Legislature to protect Florida families from these unfair situations.
When homeowners purchase insurance, they have the option to purchase actual cash value coverage or replacement cost coverage for their personal property. If the consumer chooses replacement cost for their personal property, they pay an additional premium. They should have the right to have claims paid in accordance with the contract they have purchased. If insurers do not think the premium they are charging is sufficient, this issue should be addressed in the insurers’ rate filings. Senator Storms’ amendment offers the protection that Florida’s insurance consumers deserve.
The Insurance Consumer Advocate is appointed by Florida Chief Financial Officer Alex Sink and is committed to finding solutions to insurance issues facing Floridians, calling attention to questionable insurance practices, promoting a viable insurance market responsive to the needs of Florida’s diverse population and assuring that rates are fair and justified.