Florida 2023 Regular Session

Florida House Bill H1141 Compare Versions

Only one version of the bill is available at this time.

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3	3	HB 1141 2023
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7	7	CODING: Words stricken are deletions; words underlined are additions.
8	8	hb1141-00
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10	10	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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14	14	A bill to be entitled 1
15	15	An act relating to the resolution of disputed property 2
16	16	insurance claims; amending s. 627.7015, F.S.; 3
17	17	requiring, rather than authorizing, parties to a 4
18	18	property insurance claims dispute to participate in 5
19	19	mediation; providing that mediation is a condition 6
20	20	precedent to commencing litigation; providing that the 7
21	21	parties may mutually agree to conduct the mediation by 8
22	22	teleconference or by telephone; requiring all insure ds 9
23	23	to personally attend the mediation; revising and 10
24	24	specifying duties as to bearing certain costs of 11
25	25	mediation; requiring, rather than authorizing, the 12
26	26	Department of Financial Services to adopt certain 13
27	27	rules; authorizing the department to adopt certain 14
28	28	emergency rules; requiring the policyholder to provide 15
29	29	the insurer with certain documents within a certain 16
30	30	timeframe after mediation is invoked; revising 17
31	31	conditions under which a policyholder has a certain 18
32	32	timeframe to rescind a settlement; revising the 19
33	33	definition of the term "claim"; providing 20
34	34	construction; amending s. 627.7074, F.S.; conforming a 21
35	35	provision to changes made by the act; providing an 22
36	36	appropriation; providing an effective date. 23
37	37	24
38	38	Be It Enacted by the Legislature of the State of Florida: 25
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40	40	HB 1141 2023
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44	44	CODING: Words stricken are deletions; words underlined are additions.
45	45	hb1141-00
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47	47	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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52	52	Section 1. Section 627.7015, Florida Statutes, is amended 27
53	53	to read: 28
54	54	627.7015 Mandatory mediation Alternative procedure for 29
55	55	resolution of disputed property insurance claims. — 30
56	56	(1) This section sets forth a nonadversarial alternative 31
57	57	dispute resolution proc edure for a mediated claim resolution 32
58	58	conference prompted by the need for effective, fair, and timely 33
59	59	handling of property insurance claims. There is a particular 34
60	60	need for an informal, nonthreatening forum for helping parties 35
61	61	who elect this procedure to resolve their claims disputes 36
62	62	because most homeowner and commercial residential insurance 37
63	63	policies obligate policyholders to participate in a potentially 38
64	64	expensive and time-consuming adversarial appraisal process 39
65	65	before litigation. The procedure set forth in this section is 40
66	66	designed to bring the parties together for a mediated claims 41
67	67	settlement conference without any of the trappings or drawbacks 42
68	68	of an adversarial process. Before resorting to these procedures, 43
69	69	policyholders and insurers are encouraged to reso lve claims as 44
70	70	quickly and fairly as possible. This section applies is 45
71	71	available with respect to claims under personal lines and 46
72	72	commercial residential policies before commencing the appraisal 47
73	73	process and is a condition precedent to , or before commencing 48
74	74	litigation. Mediation may be requested only by the policyholder, 49
75	75	as a first-party claimant, a third -party, as an assignee of the 50
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77	77	HB 1141 2023
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81	81	CODING: Words stricken are deletions; words underlined are additions.
82	82	hb1141-00
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84	84	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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86	86
87	87
88	88	policy benefits, or the insurer. However, an insurer is not 51
89	89	required to participate in any mediation requested by a third -52
90	90	party assignee of the policy benefits. If requested by the 53
91	91	policyholder, Participation by legal counsel is permitted. 54
92	92	Mediation under this section is also required of available to 55
93	93	litigants referred to the department by a county court or 56
94	94	circuit court. This secti on does not apply to commercial 57
95	95	coverages, to private passenger motor vehicle insurance 58
96	96	coverages, or to disputes relating to liability coverages in 59
97	97	policies of property insurance. 60
98	98	(2) At the time of issuance and renewal of a policy or at 61
99	99	the time a first-party claim within the scope of this section is 62
100	100	filed by the policyholder, the insurer shall notify the 63
101	101	policyholder of its right to participate in the mandatory 64
102	102	mediation program under this section. The department shall 65
103	103	prepare a consumer information pa mphlet for distribution to 66
104	104	persons participating in mediation. 67
105	105	(3) If the parties mutually agree, mediation may be 68
106	106	conducted by teleconference or by telephone in lieu of appearing 69
107	107	in person. All named insureds must personally attend the 70
108	108	mediation, regardless of how conducted. The costs of mediation 71
109	109	must be reasonable, and the insurer must bear all of the cost of 72
110	110	conducting mediation conferences, except as otherwise provided 73
111	111	in this section. If a named insured or their representative 74
112	112	policyholder fails to appear at the conference, which prevents 75
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114	114	HB 1141 2023
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118	118	CODING: Words stricken are deletions; words underlined are additions.
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121	121	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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125	125	the mediation from proceeding, the conference must be 76
126	126	rescheduled upon the policyholder's payment of the costs of a 77
127	127	rescheduled conference. If the insurer fails to appear at the 78
128	128	conference, the insurer must pay the policyholder's actual cash 79
129	129	expenses incurred in attending the conference if the insurer's 80
130	130	failure to attend was not due to a good cause acceptable to the 81
131	131	department. An insurer will be deemed to have failed to appear 82
132	132	if the insurer's representative lacks a uthority to settle the 83
133	133	full value of the claim. The insurer shall incur an additional 84
134	134	fee for a rescheduled conference necessitated by the insurer's 85
135	135	failure to appear at a scheduled conference. The fees assessed 86
136	136	by the administrator must include a charge n ecessary to defray 87
137	137	the expenses of the department related to its duties under this 88
138	138	section and must be deposited in the Insurance Regulatory Trust 89
139	139	Fund. If a party elects to request an expert or a representative 90
140	140	to attend the mediation, that party must bea r any cost for the 91
141	141	attendance of the expert or representative. 92
142	142	(4) The department shall adopt by rule a property 93
143	143	insurance mediation program to be administered by the department 94
144	144	or its designee. The department shall may also adopt special 95
145	145	rules that which are applicable in cases of an emergency within 96
146	146	the state, including emergency rules as necessary to establish 97
147	147	physical addresses for the mediation program in areas affected 98
148	148	by natural disasters . The rules shall be modeled after practices 99
149	149	and procedures set forth in mediation rules of procedure adopted 100
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151	151	HB 1141 2023
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155	155	CODING: Words stricken are deletions; words underlined are additions.
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158	158	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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160	160
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162	162	by the Supreme Court. The rules shall provide for: 101
163	163	(a) Reasonable requirement for processing and scheduling 102
164	164	of requests for mediation. 103
165	165	(b) Qualifications, denial of application, suspension, 104
166	166	revocation of approval, and other penalties for mediators as 105
167	167	provided in s. 627.745 and the Florida Rules for Certified and 106
168	168	Court-Appointed Mediators. 107
169	169	(c) Provisions governing who may attend mediation 108
170	170	conferences. 109
171	171	(d) Selection of mediators. 110
172	172	(e) Criteria for the conduct of mediation conferences. 111
173	173	(f) Right to legal counsel. 112
174	174	(5)(a) All statements made and documents produced at a 113
175	175	mediation conference shall be deemed to be settlement 114
176	176	negotiations in anticipation of litigation within the scope of 115
177	177	s. 90.408. All parties to the mediation must negotiate in good 116
178	178	faith and must have the authority to immediately settle the 117
179	179	claim. Mediators are deemed to be agents of the department and 118
180	180	shall have the immunity from suit provided in s. 44.107. 119
181	181	(b) Once mediation is invoked, the policyholder must 120
182	182	within 10 days provide to the insurer any and all supporting 121
183	183	documents and information that serve as the basis for the claim. 122
184	184	(6)(a) Mediation is nonbinding; however, if a written 123
185	185	settlement is reached and the policyholder is not represented by 124
186	186	an attorney or a public adjuster , the policyholder has 3 125
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188	188	HB 1141 2023
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192	192	CODING: Words stricken are deletions; words underlined are additions.
193	193	hb1141-00
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195	195	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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197	197
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199	199	business days within which the policyholder may rescind the 126
200	200	settlement unless the policyholder has cashed or deposited any 127
201	201	check or draft disbursed to the policyholder for the d isputed 128
202	202	matters as a result of the conference. If a settlement agreement 129
203	203	is reached and is not rescinded, it is binding and acts as a 130
204	204	release of all specific claims that were presented in that 131
205	205	mediation conference. 132
206	206	(b) At the conclusion of the mediation, the mediator shall 133
207	207	provide a written report of the results of mediation, including 134
208	208	any settlement amount, to the insurer, the policyholder, and the 135
209	209	policyholder's representative if the policyholder is represented 136
210	210	at the mediation. 137
211	211	(7) If the insurer fai ls to comply with subsection (2) by 138
212	212	failing to notify a policyholder of its right to participate in 139
213	213	the mediation program under this section or if the insurer 140
214	214	requests the mediation, and the mediation results are rejected 141
215	215	by either party, the policyholder is not required to submit to 142
216	216	or participate in any contractual loss appraisal process of the 143
217	217	property loss damage as a precondition to legal action for 144
218	218	breach of contract against the insurer for its failure to pay 145
219	219	the policyholder's claims covered by the p olicy. 146
220	220	(8) The department may designate an entity or person to 147
221	221	serve as administrator to carry out any of the provisions of 148
222	222	this section and may take this action by means of a written 149
223	223	contract or agreement. 150
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225	225	HB 1141 2023
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232	232	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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236	236	(9) For purposes of this section, the term "c laim" refers 151
237	237	to any dispute between an insurer and a policyholder relating to 152
238	238	a material issue of fact other than a dispute: 153
239	239	(a) With respect to which the insurer has a reasonable 154
240	240	basis to suspect fraud; 155
241	241	(b) When the insurer has determined , based on agreed-upon 156
242	242	facts as to the cause of loss, there is no coverage under the 157
243	243	policy; 158
244	244	(c) With respect to which the insurer has a reasonable 159
245	245	basis to believe that the policyholder has intentionally made a 160
246	246	material misrepresentation of fact which is relevant to the 161
247	247	claim, and the entire request for payment of a loss has been 162
248	248	denied on the basis of the material misrepresentation; 163
249	249	(d) With respect to which the amount in controversy is 164
250	250	less than $500, unless the parties agree to mediate a dispute 165
251	251	involving a lesser amount; or 166
252	252	(e) With respect to a loss that does not comply with s. 167
253	253	627.70132. 168
254	254	(10) Participation in mediation under this section before 169
255	255	the policyholder's filing of a notice under s. 627.70152 does 170
256	256	not prohibit or waive an insurer's right to invoke and 171
257	257	participate in mediation under this section in response to the 172
258	258	notice. 173
259	259	Section 2. Subsection (3) of section 627.7074, Florida 174
260	260	Statutes, is amended to read: 175
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262	262	HB 1141 2023
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266	266	CODING: Words stricken are deletions; words underlined are additions.
267	267	hb1141-00
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269	269	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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273	273	627.7074 Alternative procedure for resolution of disputed 176
274	274	sinkhole insurance claims. — 177
275	275	(3) If there is coverage available under the policy and 178
276	276	the claim was submitted within the timeframe provided in s. 179
277	277	627.706(5), following the receipt of the report provided under 180
278	278	s. 627.7073 or the denial of a claim for a sinkhole loss, the 181
279	279	insurer shall notify the policyholder of his or her right to 182
280	280	participate in the neutral evaluation program under this 183
281	281	section. Neutral evaluation supersedes the mediation alternative 184
282	282	dispute resolution process under s. 627.7015 but does not 185
283	283	invalidate the appraisal clause of the insurance policy. The 186
284	284	insurer shall provide to the policyholder the consumer 187
285	285	information pamphlet prepared by the department pursuant to 188
286	286	subsection (1) electronically or by United States mail. 189
287	287	Section 3. For the 2023-2024 fiscal year, the sum of $1 190
288	288	million in recurring funds is appropriated from the Insurance 191
289	289	Regulatory Trust Fund to the Department of Financial Services 192
290	290	for the purpose of administering the amendment made by this act 193
291	291	to s. 627.7015, Florida Statutes. 194
292	292	Section 4. This act shall take effect January 1, 2024. 195