Everybody is aware of the major premium increases recently for property insurance, and flood insurance in particular. Flood insurance has gone through the roof, probably due in part to the massive losses from hurricane Ian.

The Florida Legislature convened for a Special Session specifically to address property insurance. Among the legislation, the Legislature passed Senate Bill 2A, which makes sweeping changes to the property insurance claims process, reinsurance, regulation of insurance companies and more.

The bill is not expected to have an immediate impact on premiums, but hopefully it will have a long term effect to create an improvement.

There is a lot in the bill. There is an interesting provision about roofs. An insurance company cannot refuse to issue or renew a homeowners insurance policy on a home with a roof less than 15 years of age solely because of the roof’s age.

If a roof is 15 years old or older, an insurance company must allow a homeowner to have  a roof inspection performed by an authorized inspector before requiring the roof to be replaced in order to have the policy issued or renewed. The homeowner is responsible for the cost of the inspection. The insurance company may not refuse to issue or renew a homeowners insurance policy solely because of roof age if an inspection of the roof indicates that the roof has five years or more of useful life.

Contractors are prohibited from making written or electronic communications that encourage a homeowner to contact a contractor or public adjuster to make a property insurance claim for roof damage unless the solicitation.

In reference to attorney fees- the bill repeals the one-way attorney fee provisions related to property insurance claims. This means that neither party can be awarded attorney fees in a property insurance claims lawsuit. Each party is responsible for payment of their own attorney fees. The bill attempts to lower the cost of attorney fees.

The bill establishes the Florida Optional Reinsurance Assistance (FORA) Program for the 2023 hurricane season, which:

• Provides optional hurricane reinsurance that insurance companies can purchase at reasonable/near market rates.

• Reinsurance is insurance purchased by insurance companies. Reinsurance rates are expected to increase at least 50%. To cover the increased cost, insurance companies pass on those expenses to policyholders in the form of premium increases. The Legislature is hopeful that lower reinsurance rates offered through the Florida Optional Reinsurance Assistance program will decrease the need for insurance companies to increase premiums.

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