The Expert Podcast

…In Florida personal lines insurance meaning homeowners and auto is skyrocketing in set to even have a more crisis. Level increase in rates and even coverage availability. going into the new year. And even if you're not in Florida, it's important to know about this so that you can make sure it doesn't happen in your state and you can avoid it. So. According to this industry publication personalized and Florida is a crisis level. event insurance rates and it has to do with abusive lawsuits and fraud Well how does that happen Is it just Florida Is it people in Florida ? Well, it's a little bit different than just the culture in Florida which may have part to do with it But. And that's to do with. There's certainly some severe weather events in Florida There's there's hurricanes that happen in Florida and floods. But the biggest reason is because the Florida legislature. Change the law. Several years ago, which allowed for a very unique fraud event to happen in insurance So what would happen is. A contractor, a roofing contractor a mold mitigation contractor was allowed to go to a homeowner. And say look. we can get you a free roof on your house All you have to do is sign this form and we'll take care of everything We'll contact the insurance company. We'll get your claim paid We'll get your roof fixed We'll get everything done. And you don't have to lift a finger or pay a dime. And it was called assignment of benefits AOB, and this assignment of benefits Basically what you're assigning is a form that said this. Roofing company or this mold company. I'm assigning all the benefits of my insurance policy to this company And I'm giving them authority to negotiate with you as an insurance company to get my claim paid And you think that's a good thing however, it also. Gave that…Company complete control over the payment of your claim And they could submit bills to the insurance company, even if they were fraudulent And if they're fraudulent bills you're on the hook for them. What's the cause and effect. Unscrupulous lawyers and an unlicensed insurance specialist. We're targeting homeowners. Promising them exceptional results If they sign over their right to make a claim. And they would sell themselves as taking care of everything. All dealings with the insurance company. And sometimes they would even go. them financial incentives We'll give you a gift card We'll give you some money which is illegal…And it also changed the law to say that if the insurance company didn't pay a claim that the homeowner thought was correct. That the homeowner could Sue and get legal fees back for what they felt they deserved…Well now you're assigning that benefit to Sue over to some roofing company. So the roofing company sends an inflated bill to the insurance company. For more than what it should be. And if the insurance company box there says this is ridiculous There's not that much damage or bills too high. Now that roofing company says well that's fine We'll Sue you. And you have to pay our legal fees…And because of that, the law firms adjusters and contractors scammed homeowners. And jacked up the rates So now what happened is the insurance companies having paid all these inflated claims have to raise their insurance rates. To homeowners…So those victories that you thought you had which are really just insurance fraud led to premium increases of 40% meaning that if you were paying $2,000 for an insurance policy now, paying almost $3,000 a year for an insurance policy. And. Carrie your appetite waned What does that mean ? That means a lot of insurance company says we're not even writing policies in Florida…And so sometimes their policies get canceled or not renewed and you can't get new insurance unless you go into what's called the. the pool. The high risk pool and in Florida is called citizen's insurance. and it's high rates and, you know maybe higher deductibles and poor coverage. So this is something that happened because of a law that was passed specifically in Florida. But there may be other reasons this could creep into other states if there's similar laws passed or even if there's not a law pass but if other contractors or, Attorneys or law firms decide to try to use the same angle. With. homeowners in different states the same thing could happen So be aware of this assignment of benefits or unscrupulous contractors putting in insurance claims on behalf of a homeowner. Even if the rates in the state overall don't go up your rates are going to go up If you have excessive claims or try to put in a fraudulent claim or have one done on your behalf…