The 2021 Florida Legislature Deja Vu, Insurance Reform Proposal- House Bill 305
So let me see if I have this right. Of course, I have this right! Déjà vu all over again. Within House Bill 305 there is language that not only treads on but stomps on the rights of two business entities which by the way are both licensed and pay fees to two branches of the Florida state government in order to conduct legal and necessary business. Why else would they be issued a license and required to mail fees to Tallahassee if they were not legal and necessary?
Let me explain. As the story line is now being presented, roofing contractors and public adjusting companies will be prohibited from soliciting legitimate business entailing damages to roofs if House Bill 305 is passed or if the language regarding the two aforementioned business entities is merged into Senate Bill 76, which the full Senate has already voted.
Roof damage is and always has been a component of losses following wind, fire, water, damage from hail, and I could go on ad nauseam, but you get the picture. These events are exactly what the State of Florida issues licenses for and collects fees from roofing companies and public adjusting firms so they can be one of many business professionals consumers can turn too following losses to roofs from these casualty events.
So why is the current debate in the legislative halls of Tallahassee déjà vu? From this writer’s opinion and based on recent history, the Florida Supreme Court ruled a few years ago that laws implemented to prohibit public adjusters from solicitation and/or restricting public adjusters from handling Citizens Insurance claims was unconstitutional and was the free speech issue! So here we go again!
Is it not a violation of the basic rights of two legitimate businesses to prohibit these folks from handing out business cards and solicitation as outlined in this proposed House bill? This is again an attempt to interfere with free speech as was the case with the Citizen’s debacle that was resolved in favor of the public adjusting profession at a great finical cost to both parties. And make no mistake if the “insurance reform” as proposed in house Bill 305 bill is passed and subsequently signed by the Governor, it will again result in a challenge that will wind its way up to the Florida Supreme Court.
But let me state for the record, our firm does not now or have we ever focused on any marketing efforts to encourage consumers to file roof claims just to get insurance money. We have been a fierce advocate to help our clients with roofing issues when a substandard offer is made, or a denial of a claim is issued when that denial was clearly not justified based on the facts of the loss as well as the promise on the insurance carrier to fully indemnify their policyholder.
Based on our experience, a fierce advocate is often needed in legitimate roof claims as consumer simply do not know or understand the nuances that come up when trying to determine causation, the scope of the loss, and last but not least, the pricing. These variables can have a huge impact on claims following a Cat event or a construction boom as we are currently experiencing.
To be fair, not all roofing losses are contested but due to the subjective nature of the issues as outlined above all too often the carriers are trying to force a patch job of one sort or another. And remember, the current Florida Building Code requires by law that if 25% of a roof is damaged the whole roof has to be replaced.
So, are there unethical folks running around ginning up claims with the knowledge that if the insurance carrier does not pay, they can flip the file to what’s been called the “shady” element of the Florida legal profession? My answer is yes. This seems to be born out, given the universal reporting of the sheer volume of questionable lawsuits being filed in this state where the reporting frequently includes the mention of shady lawyers. A quick search of the word “shady” offers this definition; “of doubtful honesty or legality.” So, it would seem the prefix in this term “doubt” is the get-out-of-jail card for shady lawyers as it is “doubtful” their practices are shall we say on the up-and-up. Based on all the data being presented, it certainly seems their conduct is very questionable. But questionable and doubtful seemingly does not allow for any repercussions for conduct called shady, thus the insurance claims keep being litigated.
But let’s be clear, roofers or public adjusters don’t advance fake roof claims on their own. So maybe the answer lies somewhere else. Could some of the fault fall at the feet of the insurance industry?
The first place I would look is the staffing of competent claims field adjusters. Do the current bench of “PUP” insurance carriers actually have the trained staff to go out and look at so called fake roof claims and (if they are fake) do a proper investigation to defend a denial of the claim? What’s the ratio of staffing to policies sold? Now that would be an eye opener. And while we are at it, what about all these “unlicensed loss consultants” and other freelancers who are acting as feeders to the “shady lawyer” types?
Surely folks in the positions of power such as regulators, etc. should be tasked to handle referrals of alleged misconduct. Are they up to the job of providing some form of quality enforcement to protect the insurance consumer? If not, then why is the legislature not looking at funding staff to actually protect both the insurance industry and the insurance consumer from folks who are most likely unlicensed, and I would assume the source of conduct that has drawn the ire of industry and government folks which has resulted in this current debate on property insurance reform.
To be fair, the insurance industry has pivoted from having fewer actual trained and licensed adjusters either in the form of staff (annual salary) or independent licensed adjuster (firms that hire themselves out to insurance companies). So, what we are seeing now are big national firms (brought in by the insurance carriers) acting as loss consultants replacing the licensed adjuster function which in my mind brings up the question of the bias they may have. This appears to be another insurance problem of dueling unlicensed loss consultants and others who are by extension, not regulated.
Without question, there are much needed reforms in Florida when it comes to property insurance. Some of the changes as outlined in the Senate Bill 76 are worth consideration. But picking the low hanging fruit of roofers and public adjusters solicitation practices may be a nice sound bite to some, but please don’t insult our intelligence by claiming this prohibition on solicitation of roofing claims is a panacea for what some folks are calling a property insurance crisis. And if you have been fortunate enough to have seen the history of insurance legislation as I have in my 45-year career as an adjuster, there has been no shortage of insurance crisis. If the language in this bill rubs you the wrong way, you can easily fire off a note to those legislators and voice your opinion.
Finally, if some folks think this crisis is deserving of change, here are a couple of ideas. First, I suggest a crackdown on those unlicensed individuals who call themselves “loss consultants.” Put some accountability in place on this subset of runners and/or so-called experts. Second, staff up claim departments and make the carriers have their field adjusters do actual inspections. Third, bulk up the regulation staff to investigate referrals sent to them by insurance companies, insurance consumers and would you believe, licensed public adjusters which includes the trade association, FAPIA. Fourth, get the Florida Bar involved to have mandatory training to get rid of that “shady “moniker that is causing a plague on ethical lawyers versus those whose skill sets are more attuned to filing questionable and doubtful roofing lawsuits.
Yes, I know that word “doubtful” is a problem but maybe a learned oversight group can legitimately compile a “shady” list of lawyers and petition the Florida Bar Association to help convince the wayward members to focus on other matters than roof claims and the lawsuits that follow. Let us know what you think.