By William Rabb 

Please call  Lee from  USAsurance Powered by WeInsure & Calle Financial. 954-270-7966 or 833-USAssure at the office. My email is . I am Your Insurance Consultant  about Home Insurance, Auto, Flood, Private Flood, Car, Life Insurance, Mortgage protection, Financial Products, Business  & Commercial Policies, & Group Products for business owners to give Employees benefits at no cost to the employer. My email is

Two insurance company rating firms have joined the call for Florida lawmakers to approve decisive measures to stave off financial disaster for more property insurers.

Legislation passed in 2019 and 2021, designed to deter assignment-of-benefits claims and reduce litigation, “has not achieved the desired effect. Further action is essential to stabilize the market,” AM Best wrote in a white paper published Monday.

At a Fort Lauderdale conference last week, the president of the Demotech rating firm also urged legislators, when they meet this month, to adopt specific reforms that could help reduce loss costs and loss adjustment expenses for struggling Florida carriers.


“We believe that certain meaningful and significant legislative reform, if enacted during a special session prior to the most common renewal date for reinsurance treaties, June 1, may create circumstances permitting us to maintain ratings for some of those insurers currently expected to be downgraded,” Demotech President Joe Petrelli said at the Demotech / Intermediaries & Reinsurance Underwriters Association conference.

Florida Gov. Ron DeSantis has called a special legislative session for May 23-27 to tackle a number of issues facing the property insurance market in the state, including reinsurance, changes to building codes, litigation reform, and changes in appropriations and changes to the Office of Insurance Regulation.

Petrelli outlined three key ingredients needed right away:

  • Changes to statutes that allow contingency fee multipliers for attorneys who represent policyholders;
  • Suspension of the Florida Hurricane Catastrophe Fund’s rapid cash build-up requirement;
  • Lowering the cat fund’s retention amount, or the attachment point for industry losses, which would allow insurers to access the state fund and purchase less reinsurance on the open market.

“We believe the sustainability of the Florida property insurance marketplace and the financial stability of the insurers operating in Florida depend upon immediate, meaningful legislative action,” Petrelli said.

AM Best’s report, which included contributions from AM Best analysts Chris Draghi and David Blades, is titled, “Troubled Florida Property Market Participants Under Immense Pressure.” It echoed insurers’ arguments that underwriting losses are not necessarily the result of major storms in the hurricane-prone state.

“Contrary to conventional perception, hurricane losses were not the primary culprit – results continue to erode despite the last major landfall occurring in 2018 (Hurricane Michael),” the commentary noted. “The deterioration in performance is a by-product of the greater frequency of secondary perils (severe thunderstorms, wind, hail), higher reinsurance costs, escalating litigation costs, and building codes/laws that have been flouted by parties looking to profit.”

Despite double-digit rate increases by a number of insurers in Florida, conditions remain unsustainable, the AM Best report said. Some improvements were seen after the Legislature approved the AOB reform law in 2019, House Bill 337, and after Senate Bill 76 was passed in 2021. “But more legislative work is critical as litigated claims appear to be creeping up again.”

Both reports cited actions by Florida regulators and insurers in recent months, including insolvencies, suspension of new business, non-renewals and a pull-back from some areas of the state and some types of properties.

“As a result of observed challenges, the ratings and outlooks, particularly for those entities not part of larger groups, remain under pressure,” the AM Best paper noted.

AM Best historically has provided financial ratings for larger carriers, while Demotech was asked in 1996 to rate smaller Florida insurers and subsidiaries of large companies.