2022 Means More Claims Data From Florida Insurers, Notification on Surplus Lines

New Florida laws and regulations that govern insurance matters took effect Sunday. Some are minor changes to existing laws, but others could affect insurers and agents for years to come.

Here’s a look at some of the new requirements.

Data Call

Senate Bill 76 was the major piece of property insurance reform legislation that was passed by the Florida Legislature in 2021. Most of the bill, which seeks to limit claims litigation, took effect last summer. But one significant section kicked in Jan. 1.

Starting this week, all residential property insurers must start collecting data for annual reports to be filed with the state Office of Insurance Regulation, about closed claims. The reports must provide two dozen data points, including claim number, policy type, location, names of repair vendors, public adjusters, claimant’s attorney, and amounts paid out, including attorney fees.

The idea is to provide regulators with more data that can be used to track claims litigation and costs.

But while insurers must start collecting the data this week, information about the forms, templates and electronic format insurers should use to file the data has yet to be produced. The OIR on Oct. 29 posted a notice of rule development regarding the reporting forms. It gave little information but said if deemed necessary, a workshop will be held.

As of late last week, though, no workshop date had been published in the Florida Administrative Register.

A delay in the forms and format could cause some headaches for insurance carriers, some industry analysts said. A spokeswoman for the insurance office said the information will be provided when updates become available.

Notice to Policyholders

SB 1598, another property insurance reform measure passed in 2021, includes a section that affects insurers, adjusters and agents in 2022.

Starting Jan. 1, insurance agents can go directly to the surplus lines market to place some types of property policies, and they have to inform the policyholder in writing, according to the statute.

Starting Saturday, agents need to provide the insured with this statement: “You are agreeing to place coverage in the surplus lines market. Coverage may be available in the admitted market. Persons insured by surplus lines carriers are not protected under the Florida Insurance Guaranty Act with respect to any right of recovery for the obligation of an insolvent unlicensed insurer.”

Some have said that the change will result in more competition in Florida’s distressed market from the lightly regulated surplus lines carriers.

Also starting this week, the law requires insurers to notify consumers if their credit reports or credit scores are being requested for underwriting purposes. This notice must be included: “The Department of Financial Services offers free financial literacy programs to assist you with insurance-related questions, including how credit works and how credit scores are calculated. To learn more, visit www.MyFloridaCFO.com.”

Insurance companies that make adverse decisions on coverage must provide a copy of the credit report at no charge to the consumer or provide contact information about the credit reporting service, the law reads.

The statute also now gives insurers 14 days, instead of 10, after receiving a proof-of-loss statement, to begin investigating a claim. Insurance company adjusters must also provide the property owner with their state adjuster license numbers, and insurers must keep a record of adjusters who communicate with the insured. When providing partial payment on a claim, the insurer must now provide a written statement that the claim is still being evaluated.

SB 1598 also makes it clear that interest payments are due when an insurance company fails to pay the full settlement of the claim or an undisputed portion of the claim within 90 days after the claim is filed.

Continuing Education for Agents

Starting Jan. 1, HB 1209 revises the number of continuing education hours for most insurance agents. The update course needed every two years, for example, will be four hours instead of five, the law reads.

Insurance Requirements for Car-Sharing

Senate Bill 566 now requires people who participate in peer-to-peer car-sharing programs, including owners and rental drivers, to carry at least the minimum amount of auto insurance.

“We are mirroring what is required by Enterprise or Alamo and the other ones,” Sen. Keith Perry, R-Gainesville, said during debate on the bill last spring, according to news reports.

The Tennessee General Assembly adopted a similar measure, which also takes effect Saturday.

Workers’ Comp Rate Decrease

Most Florida employers will see lower workers’ compensation premiums on new and renewing policies starting in January, after the state Office of Insurance Regulation approved a 4.9% average rate decrease. It’s the sixth straight rate decrease for Florida.

Topics Florida Carriers Claims Excess Surplus Data Driven