A Florida House panel has advanced a measure that could undo much of the work that has been done in the Sunshine State to reduce premiums, and could shift the financial burden of legal battles in insurance disputes back on to insurers in certain cases, reviving a debate over consumer protections and industry stability.
The state has long struggled with a high volume of insurance-related lawsuits, particularly involving claims for roof damage and water losses. Some attorneys and contractors have been accused of exploiting assignment of benefits (AOB) agreements and filing excessive or inflated lawsuits, leading to substantial legal costs for insurers. Florida accounts for a disproportionate percentage of the nation's property insurance lawsuits, despite representing a much smaller share of total policies.
Last week, the House Civil Justice and Claims Subcommittee voted overwhelmingly, 16-1, in favor of HB 1551, introduced by Rep. Hillary Cassel, a Republican from Broward County and a practicing insurance attorney. The bill would allow policyholders to recover attorney fees if they prevail in lawsuits against their insurers, reversing recent changes that critics say stripped consumers of crucial leverage.
Cassel described the legislation as a middle-ground solution aimed at curbing exploitative practices while discouraging unnecessary litigation. “HB 1551 takes a balanced approach to attorney fee awards in insurance contract disputes,” she told lawmakers. “This bill aims to reform attorney fees awards in insurance litigation by promoting fairness and reducing unnecessary lawsuits.”
In 2022 and 2023, Florida lawmakers passed sweeping tort reform measures that eliminated what’s known as the “one-way attorney fee” provision, which previously enabled plaintiffs to recover legal costs when suing insurance companies. Insurers had argued the rule encouraged frivolous claims, while consumer advocates contended it gave policyholders a fighting chance against powerful insurance firms.
Under HB 1551, courts would apply a “prevailing party” standard - commonly referred to as a “loser pays” system - when determining whether insurers or policyholders are responsible for attorneys' fees. Cassel stressed that the approach still requires consumers to share some financial risk while ensuring bad-faith denials by insurers don’t go unchecked.
Industry groups, however, warned the bill threatens the fragile recovery of Florida’s insurance market. Katelyn Ferry, representing the Florida Justice Reform Institute, argued the proposal could reverse recent progress. “Make no mistake: If this bill passes, it’ll eradicate Florida’s insurance market,” Ferry said. She credited previous reforms with curbing premium hikes and attracting new insurers to the state, questioning why lawmakers would “fix” a system she claims is working.
Meanwhile, Todd Michaels, president of the Florida Justice Association, voiced strong support for the bill, saying it would help restore fairness to a lopsided process. The core issue, Michaels said, is simple: “Shouldn’t it be the wrongdoer?” referring to insurers who improperly deny legitimate claims, prompting costly litigation.
House Speaker Daniel Perez, a Miami lawyer, has pledged to focus on consumer-oriented reforms. His comments, coupled with mounting scrutiny of the insurance sector’s financial transparency, have shifted the tone in Tallahassee.
Adding to the pressure, Florida Insurance Commissioner Michael Yaworsky acknowledged last week that his office may have fallen short in thoroughly investigating insurer conduct, citing staff shortages and other challenges during the height of the state's insurance crisis. Executives at several insurance firms have disputed allegations of impropriety, arguing that the reports do not provide a complete picture.
During the subcommittee hearing, Democratic Rep. Ashley Gantt, an attorney from Miami, urged colleagues to back Cassel’s bill, referencing the recent reporting. Gantt compared insurers’ attempts to shift blame to plaintiffs’ lawyers to a “Scooby-Doo” villain reveal.
“Peel back the mask, and the real culprits are unscrupulous insurers,” Gantt said. “This bill provides the justice that our constituents actually need.”
