Lawmakers repeal fee cap on homeowners insurance adjusters
Florida lawmakers have repealed a cap of fees associated with public insurance adjusters this week in what is being considered a major victory for the homeowners insurance sector. The state introduced a 10% cap on these fees in 2008, hoping to placate some of the economic concerns that have been associated with Florida’s homeowners insurance market. The cap was meant to limit the financial risks of the state-run Citizens Property Insurance, which had been battling with homeowners insurance fraud and an epidemic of sinkhole-related damages at the time.
Fee cap initially meant to solve financial problems of Citizens Property Insurance
Citizens Property Insurance continues to be a very controversial subject in Florida. The state-run insurance company accounts for the majority of homeowners insurance policies in Florida, but has been wracked by serious financial problems since 2005; a flurry of natural disasters over the past decade have only worsened the insurer’s financial situation. In 2012, state lawmakers took it upon themselves to introduce radical reformations to the insurer in the hopes of making it less of a financial burden on the state.
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Adjusters can now receive up to 20% fee for services
Included in the reforms introduced by lawmakers was a 10% cap on the fees associated with public insurance adjusters. These fees were typically tacked on to claims handled by Citizens Property Insurance, thereby introducing yet further financial liability for the homeowners insurance provider. Now that this cap has been repealed, public adjusters will be able to receive a 10% fee for any initial hurricane-related claims made this year. Adjusters will also receive a 20% fee for claims made in 2014 and beyond.
Repeal of fee cap considered a boon for consumers and adjusters alike
Lawmakers suspect that repealing the cap will benefit consumers overall. Public adjusters are valuable in the homeowners insurance sector as they help provide consumers with an independent assessment of the damage caused by natural disasters and other catastrophes. In many cases, these adjusters can ensure that claims are filed properly and that consumers receive the benefits they are due by their homeowners insurance provider.