Welcome to a different chapter within the ever-entertaining saga of Florida insurance coverage regulation—the place the sudden is anticipated, and actuality generally reads like satire. The most recent? Florida’s insurance coverage regulators are serving subpoenas on a critic who dared to highlight obvious points within the insurance coverage business. Sure, you learn that proper. As an alternative of addressing the business’s woes, they’ve determined to play a sport of “blame the messenger.”
The Tampa Bay Occasions article written by Lawrence Mower, Florida Regulators Challenge Subpoenas to Insurance coverage Business Critic, uncovered this current tactic and had me double-checking my inbox to see if my workplace had been subpoenaed, too. Right here’s the gist:
Weiss Scores, a Palm Seashore Gardens-based monetary rankings company, lately raised the alarm that Florida’s insurance coverage market is teetering on collapse. They backed it up with information displaying insurers denying claims left and proper and shifting cash out of the state. However as a substitute of digging into these troubling tendencies, Florida regulators determined to demand Weiss’s emails, texts, and documentation. It’s like investigating the weatherman for predicting rain whereas ignoring the floodwaters rising round you.
The Actual Numbers: Why Weiss’s Report Hit a Nerve
Let’s check out the stats Weiss highlighted: Numbers that would make even essentially the most seasoned regulator escape in hives:
- Farm Bureau Property & Casualty: Denying 70.5% of claims (Gold medalists in declare denials!)
- American Bankers Insurance coverage Firm: 51.2% denial fee (Silver medalists)
- Residents Property Insurance coverage: 50.4% denial fee (Bronze)
- Total development: Denial charges climbing from 24.9% in 2004 to 37.4% in 2023
These numbers aren’t simply alarming—they’re a flashing neon signal that claims, “One thing could be very, very incorrect right here.” To be honest, there could effectively be legitimate explanations for a few of these elevated statistics, as I lately said in A Frank Dialogue About Florida’s Insurance coverage Disaster, Together with Admissions About Why Present Claims Statistics Do Not Point out the Sky Is Falling.
Regulators’ Response: The Nice Subpoena Scavenger Hunt
As an alternative of investigating the insurers for these eye-popping denial charges, the regulators demanded Weiss produce:
- Emails about Florida’s insurance coverage market
- Texts associated to assert denials
- Proof of insurers on the “brink of collapse”
- Proof of funds diverted to shareholders
- Documentation of insurers’ “In the event you don’t prefer it, sue us” technique
Frankly, this strategy seems like attempting to repair a flat tire by yelling on the GPS.
What Regulators Ought to Be Investigating
Expensive Commissioner Yaworsky and Deputy Commissioner Parker, I would like you to achieve defending policyholders with nice protection at reasonably priced costs and make sure insurers are totally and promptly paying claims. Whereas I like the creativity in your subpoenas, right here’s a suggestion: How about aiming your investigative prowess on the insurers themselves? Right here’s a starter listing:
- Inner memos on “loss ratio administration” methods
- Govt bonus plans tied to assert denials
- Coaching manuals on “artistic” declare denials
- Correspondence about shifting reserves out of state
- Administration agreements and hidden earnings streams for executives
Oh, and let’s not neglect these PowerPoint displays on “ Pay Much less and Deny Extra.”
A Modest Proposal
Fairly than specializing in the individual holding the flashlight, why not look at the darkish corners of the business? Think about:
- Subpoenaing claims information and government communications
- Investigating reserve transfers and unexplained denials
- Exploring why denied claims usually get mysteriously paid after lawsuits
- Asking Residents why a 50.4% denial fee is appropriate
- Defending and looking for whistleblowers who expose unethical claims practices
These steps won’t be as thrilling as subpoenaing an business critic, however they’d actually do extra to revive belief in Florida’s insurance coverage market.
Closing Ideas
Dr. Weiss summarized it completely: Florida’s insurance coverage business isn’t on the point of a collapse—it’s already there within the minds of the general public. Floridians are shedding religion of their bought insurance coverage product, not due to dire predictions, however due to lived experiences: excessive deductibles, poor protection advantages, countless delays, denied claims, and an oversight system that’s extra centered on optics than outcomes.
Commissioner Yaworsky, when you’d like assist drafting subpoenas to the parents truly accountable for this mess, my workplace is at your service—professional bono. Think about it a goodwill gesture towards fixing a system that’s failing hundreds of thousands within the minds of most Floridians. There must be a larger attain for public enter and debate as a result of the general public is shedding religion of their skill to personal property attributable to considerably expensive insurance coverage that doesn’t pay after a loss.
P.S. To any impartial adjusters who’ve spoken out in regards to the wrongdoings of Florida’s claims business and are studying this weblog: Save your emails, memos, and notes. If regulators proceed down this path, you might be subsequent. And in the event that they ask you in your childhood diary, possibly it’s time to name a lawyer.
Thought For The Day
“Nobody loves the messenger who brings dangerous information.”
—Sophocles
