Senate Bill 76: New Pre-Suit Requirements for Insurance Companies and Covered Claimants

With property insurance rates skyrocketing in Florida, Senate Bill 76 was passed by the Florida Legislature to address the problem. The new Bill is expected to be signed by Florida Gov. Ron DeSantis. When he does, the procedure for bringing property insurance claims will be significantly changed – there are more pre-suit requirements for insureds and insurers, alike.

In this bill, law makers are looking to reduce property insurance rates and keep disputes on coverage out of court. The Bill even specifically targets an increase of roofing claims – barring roofers and contractors from aggressively advertising their roofing services and prohibiting them from interpreting or advising a policy-holder on anything pursuant to their insurance contract. In fact, the Florida Chamber of Commerce supports the Bill, stamping a “Pro-Biz” label on the Bill in its Legislative Update publication.

In addressing the targeted concerns, Senate Bill 76 changes the rules of the pre-suit property insurance game in the following ways:

For the Claimants:

Any claimant that is not an assignee of the policy would be required to file a letter stating the claimant’s intention to litigate, and they must do so 10 days prior to filing a lawsuit under their insurance policy. The new law would also require the claimant to state the alleged acts or omissions of the insurer in the notice letter.

A claimant who looks to file suit due to the denial of coverage, within the letter, must provide a pre-suit demand that itemizes damages (if known), any attorney’s fees and costs, and the total amount in dispute.

Senate Bill 76 also changes Florida Statute § 627.70132 — it reduces the window for notice for new and reopened claims to two years from the date of loss. Supplemental claims, under the new Bill, would have a notice period of three years from the date of loss.

For the Insurance Companies:

Upon receipt of the pre-suit notice of intent, an insurance company must respond to the claimant within 10 business days. When a claimant’s letter is not sent pursuant to a denial of coverage, Senate Bill 76 requires the insurance companies to make a settlement offer or require the claimant to participate in alternative dispute resolution before the claimant can file a lawsuit.

On the other hand, when the claimant’s letter involves a denial of coverage, the insurance company has three options: 1) the company must accept coverage, or 2) continue to deny coverage, or 3) assert its right to re-inspect the property to further assess the damages. If the company chooses the third option, then the insurance company must re-inspect the property within 14 business days of their response and give notice whether the company will decide to deny coverage or accept coverage within the same 14 days.

For Attorneys:

Senate Bill 76 even changes the way in which attorneys can be compensated. Under the new legislation, the attorney’s fees and costs will be determined based on the total amount recovered by the claimant’s recovery from the insurer pursuant to a detailed percentage-based scheme.

Claimants, Insurance Companies, and attorneys must all prepared for the imminent changes. Governor DeSantis is set to sign the Bill into law, which becomes law with an effective on July 1, 2021.