Ronald R. Assisi
Home insurance is not a warranty policy. It is intended to make you whole again after suffering sudden and/or accidental damage to your home. Unfortunately, some unscrupulous contractors promise “free” roofs to Florida homeowners for “damage” that is simply wear and tear.
Not to be outdone, there are prosecutors suing for this “damage.” Individually, each of these actions is egregious. Together, they created a toxic environment that pushed Florida’s property insurance market to the brink of collapse and sent rates skyrocketing. Nine Florida insurers have become insolvent in the past two years, and the average Florida homeowner’s premium is $4,231 according to the Insurance Information Institute, the highest in the nation. (Nearly 2 ½ times the national average.)
It sounds grim, but since it’s a man-made crisis, it can be resolved. We need legislative reform that will put an end to this cottage industry. To achieve comprehensive reform that will make the Florida property insurance market healthy and viable again, we need the following changes:
Repeal the One-Way Attorney Fee Act: If a client sues their insurance company and is awarded $1 more than their last pre-trial offer, the owner will be compensated for all attorney fees to insurance company fees. If the client does not prevail, neither he nor his attorney must compensate the insurance company for their attorney fees. With virtually no skin in the game, attorneys are free to sue at will. This could explain why Florida accounts for 9% of the nation’s property insurance claims, but an incredible 79% of the nation’s property insurance claim disputes.
Addressing the fallout caused by the 2016 Sebo decision: The Florida Supreme Court found that when two or more perils converge to cause a loss, and at least one of the perils is not covered by the policy, the insurance company is required to cover all risks. the damage. Unscrupulous contractors use this decision to combine a few wind-damaged shingles with the wear and tear of an older roof, to get a “free” total roof replacement for their clients.
Allow insurance companies to offer a roof value schedule in their home insurance policy: Just as vehicles depreciate due to wear and tear, so does the roof of a house. Car insurance companies are allowed to consider depreciation when settling a claim for a car. Not allowing home insurance companies to consider the age of a home’s roof when settling claims invites the possibility of frivolous or even fraudulent claims.
Property insurance is designed and priced to repair damage or loss caused by a covered peril: fire, theft, hurricanes and other sudden or accidental incidents. There is no price to pay for usury; in fact, wear and tear is expressly excluded from home insurance contracts. By being forced to replace worn roofs due to age and exposure to the elements, insurance has become collateral in Florida. All homeowners pay to subsidize the cost of new roofs for their neighbors.
The Florida Legislature will hold a second special legislative session in December to address the property insurance debacle in our state. Hopefully they will address all the issues that led to this crisis, so we can finally make the market viable and healthy again.
Ron Assise has nearly four decades of property and casualty insurance experience in various states across the United States. He was an instructor for the Erie Insurance Agent College and National Program Chair for three consecutive Personal Lines meetings for the Assurex Global organization. He was appointed Director of Education for the Council for Insuring Private Clients in March 2014. Ron is also a faculty member of the National Alliance for Insurance Education and sits on the Council for Insuring Private Clients Board of Directors. (CPIC). He has earned the designations of “Certified Insurance Advisor” (CIC) and “Certified Personal Risk Manager” (CPRM), and is also a frequent guest pundit on WFLA News in Tampa. Originally from southwest Chicago, in Marquette Park. Ron and his wife, Cheryl, currently live in Fort Myers and spend their summers in the Midwest.
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