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Sha'Ron James


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Senators try 'herding' lobbyists to address insurance issue

News Article

February 24, 2016

POLITICO Florida

TALLAHASSEE — Two state senators hosted a standing-room only meeting Tuesday afternoon with insurance and trial bar lobbyists as well as other stakeholders interested in assignment of benefits legislation that could grow more complicated with an expected amendment dealing with attorney fees.

With time running out in the regular 2016 legislative session, the assignment of benefits debate focuses on SB 1248, which deals with prohibited insurance practices. The measure, which will be considered Wednesday by the Senate Appropriations Subcommittee on General Government, makes no mention of assignment of benefits and attorney fees, but all that could change as state Sen. David Simmons, a Republican from Altamonte Springs, is drafting an amendment addressing the hot-button issue.

Filed by Sen. Miguel Diaz de la Portilla, a Republican from Miami,the bill became the main vehicle in the Senate when SB 596 died in the Judiciary Committee last week. A similar House bill is scheduled to be heard Thursday by the regulatory affairs committee.

“What I tried to do today is bring in all the parties — the remediators, the adjusters, the attorneys from the Florida Justice Association, the insurance companies — into a room and try to see where we can find common ground to address the abuses that exist in terms of fraud and fraudulent claims, and at the same time protect the consumer and the policyholders and make sure there’s recourse when there’s bad conduct by insurance companies,” Diaz de la Portilla, who co-hosted Tuesday's meeting, told POLITICO Florida afterward.

“If you call that herding cats” — as one insurance lobbyist did — “it is, because there are many different interests who were represented here in this room and some of them may perceive the problem a little differently than their counterparts on the other side of the aisle,” Diaz de la Portilla said.

The current iteration of SB 1248 would require anyone performing emergency restoration or remediation of a property to be a licensed public insurance adjuster. Only contractors are now required to be certified public adjusters. The change would include subcontractors.

The bill does not preclude a homeowner from assigning the benefits of their insurance contract to a contractor. Instead, it tries to snuff out insurance fraud by limiting the ability of contractors to reap more than $25 for referrals to other contractors. That provision drew concern from contractors who say it might limit their ability to make use of online referral services like Angie’s List.

Diaz de la Portilla said the “intention isn’t to prohibit any marketing” and language would be added to the bill to address that concern.

SB 1248 also creates a new section of insurance law outlining prohibited practices for repair, mitigation and restoration services. Companies that violate the law could be fined upward of $10,000 per violation and the state could file cease and desist orders against violators.

“The original idea here is to do something where we can find some common ground,” Diaz de la Portilla told stakeholders. “If we can’t get consensus on these very basic things, then David [Simmons] and I will have to make a decision on our end.”

Simmons told POLITICO Florida after the meeting that his amendment, though still being drafted, would include language that would track the attorney fees language from Florida’s lien laws that allow the prevailing party to recover reasonable fees. Attorney fees would be recoverable only in instances when what is awarded to the contractor exceeds what the insurance company offered to settle the claim, he said.

“If an insurance company were able to show that the amount recovered is less than or equal to the amount offered, then there would be no attorney fees owed and insurance company could recover fees,” Simmons said, describing his intent.

Though Diaz de la Portilla said he’s confident a consensus is developing on most of the major issues, he said that “the attorney fees is probably going to take a lot of finesse to include in the bill.”