GALLAGHER JOINS LEGISLATIVE LEADERS TO PUSH FOR CONSUMERS’ BILL OF RIGHTS
A South Florida family lost their homeowners insurance after their mortgage company failed to pay premiums from escrow. Another Floridian from Tampa was denied insurance coverage on a home he was purchasing because of a past claim for water damage on the property. These stories and thousands more have prompted Chief Financial Officer Tom Gallagher to join Senator Mike Fasano and Representative David Rivera in pursuing legislation to restore Florida’s marketplace to one that is fair and reasonable for insurance consumers.
“Thousands of consumers have called us in the last year saying they feel powerless to protect themselves from their insurance companies,” Gallagher said. “It is fundamentally unfair for consumers to be non-renewed, canceled or to surrender their legal rights with no explanation, or for an insurance company to use incorrect information at the expense of consumers.”
“Consumers deserve to be in the loop on decisions made by their insurance companies so they know exactly what’s going on with their policy or claim,” Sen. Fasano said. “A Consumers’ Bill of Rights would place the consumer first, ensuring fair and equitable treatment from insurance companies.”
“State leaders have an obligation to ensure consumer protections exist when insurance is mandatory, not voluntary,” Rep. Rivera said. “This legislation ensures strong standards are in place and consumers are treated with honesty and fairness.”
The proposed legislation (SB 2038/HB 557) would provide much-needed protections to consumers insuring homes or automobiles, many of which previously existed in state administrative rule but were repealed in 2002. The legislation would require insurers to:
Consumers have told the Department of Financial Services they had difficulty finding replacement coverage after their mortgage company failed to pay premiums. Some consumers were required to accept more expensive, force-placed coverage obtained from their mortgage companies. Under this legislation, consumers would not be held responsible for their mortgage companies’ mistakes.
“In instances where a mortgage company fails to pay insurance premiums, it is unconscionable for an insurance company to then cancel a family’s coverage,” Gallagher said.
To assist auto insurance
consumers, the bill contains a measure to provide auto insurance companies with
clear guidelines for handling automobile claims. The bill would restore a
standard of “like, kind and quality” for replacement parts, a requirement which
had been in place in department rule for nearly 10 years. It also establishes
standards for dealing with total loss of automobiles to ensure consumers are
paid a fair price when their car is totaled in an accident.
Finally, the bill would create a dedicated consumer contact within the Department of Financial Services to deal with emerging sinkhole-related insurance concerns, track trends and provide information to state policymakers.
“A fair and reasonable marketplace is essential for Florida’s consumers,” said Sen. Mike Fasano, who is concerned about availability of insurance coverage for consumers in areas prone to sinkholes. “This bill recognizes the importance of hearing from consumers experiencing sinkhole-related problems, whether they are buying a home or renewing coverage.”
HB 557 unanimously passed the House Subcommittee on Insurance Regulation. The Senate version was expected to be heard March 31st in the Senate Banking and Insurance Committee.