Between 2019 and 2023, average homeowner premiums in Florida surged nearly 60%.
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Gov. Ron DeSantis earlier this month revealed good news when it comes to Florida’s insurance market. Yes, good news.
During the last three years, the Florida Legislature has passed meaningful reforms to address unrestrained litigation and reign in skyrocketing attorneys’ fees, and their efforts are bringing down the cost of insurance, inviting more competition into the market and giving consumers more choice for coverage on their home and auto.
Between 2019 and 2023, average homeowner premiums in Florida surged nearly 60%. Not only were homeowners paying more for property insurance, but they had access to less coverage and fewer providers to choose from.
This was partly due to a legal environment that was too friendly to lawsuits against insurers. For a long time, Florida law allowed plaintiffs’ attorneys to recover their fees if they prevailed against insurers, even if the amount they secured through litigation was minimal; these fees were “one way” because plaintiffs faced no reciprocal risk that they would have to cover the insurance company’s attorney fees if plaintiffs lost. Assignments of benefits were also misused by third parties in order to access these statutory, “one way” attorney fees.
Florida homeowners were left to foot insurance bill hikes
Unfortunately, the average Florida homeowner was left to foot the bill when insurance providers were forced to raise costs to cover excessive litigation. Many insurers determined that it was too costly to do business in Florida. By the end of 2024, more than 30 insurance providers had exited Florida’s marketplace.
The reforms began in 2021 when Senate Bill 76 required plaintiffs to notify an insurer before a lawsuit is filed. In turn, insurers are given an opportunity to reconsider a coverage denial and attempt to resolve a claim before it is the subject of litigation. The legislation also offered consumers additional protections from unscrupulous contractors.
Then in 2022, Senate Bill 2D, developed and passed during a special session called by the Governor, included additional tort reforms. This legislation prohibited assignment of the right to obtain attorney fees to anyone other than an insured or beneficiary named in the policy, thus eliminating abuse of these arrangements by third parties as a way to obtain attorney fees.
Later in 2022, another special session led to the passage of Senate Bill 2A. Senate Bill 2A eliminated the statutory right to recover attorney fees in a lawsuit arising under a residential or commercial property insurance policy.
Importantly, this legislation also implemented greater protections for consumers. The law requires insurance companies to be more responsive to their customers by limiting the time they have to respond to claims.
Building on these reforms, the Florida Legislature also passed House Bill 837 in 2023 to eliminate exorbitant attorney’s fees, strengthen negligence standards and provide stronger defense to those targeted by excessive litigation.
While our state leaders acted swiftly to develop, pass and implement solutions, we knew it would take time for these policies to stabilize the market. Now, the trends are moving in the right direction, providing much-needed relief to Florida’s homeowners.
Florida has 11 new insurance providers
In 2024, Florida had the lowest average homeowners’ premium increases in the nation, with an average statewide rate hike of just 1%. At the same time, premiums in other states have surged by more than 20%.
In addition, there are 11 new insurance providers in the market. And the providers that remain are expanding their business and filing for rate decreases.
This is only the beginning. As timelines run out for trial attorneys to pursue litigation under the more litigation-friendly law, the environment will continue to stabilize, reducing the burden of excessive litigation and bringing down costs even further.
Our state is proof that strong conservative leadership on the state level can lead to meaningful reforms. The steps our Governor and Legislature have taken are bringing stability to the market, leading to more choices and lower costs for Florida homeowners.
William Large is the president of the Florida Justice Reform Institute.