Week 8, 2012; action shifts to Senate; one week to go

It’s finally here! The last week of Florida’s 2012 legislative session. No insurance bill has yet to pass both the House and Senate.

Seventeen bills have been passed by the House and are ready for Senate floor action. Some will pass, some will fail. Which way they fall by Friday, March 9th (end of session) is anyone’s guess right now.

Below is an update on three highly-controversial insurance measures (including PIP), followed by a summary of the quiet ones.

Tort reforms: 2011 Florida Legislature passed some, passes on others

There were victories and defeats in the robust effort to obtain tort reform during the 2011 Florida Legislative Session.  The insurance and business communities had high hopes, anchored on Florida's conservative Legislature and Governor.  Here are hard-fought tort reform bills that passed:*

• Medical malpractice.  H479 will require out-of-state doctors to apply for a certificate to testify as an expert witness in Florida, and enable the State to discipline such doctors if they are found to have offered "deceptive or fraudulent" testimony.  For insurers, the bill eliminates the requirement that medical malpractice insurance policies include a clause authorizing the insurer to settle within policy limits without the insured's permission (and removes the prohibition against a clause giving the insured the right to veto a settlement within the policy limits).  The bill represents a big step for the Florida Medical Association, which has "been working to pass expert witness reform for over a decade."  Legislature passes lawsuit protection for doctors.

Bad Faith Set-Up: Florida Bar Article

This month's Florida Bar Journal has a feature article on insurance bad faith, "The Good Faith, Bad Faith, and Ugly Set-up of Insurance Claims Settlement." Written from the perspective of defense attorneys, the article has this set-up paragraph:

The current imbalance in Florida’s bad faith statute can be exploited to create bad faith claims where they otherwise would not exist.  This practice is commonly referred to as the “bad faith set-up,” and the various tactics used to set up bad faith claims have been well-documented by courts and commentators alike. Simply put, the “bad faith set-up” is “nothing more than an attempt to induce the insurer to commit a tort in order to explode the policy limits.

Opposition to bad faith reform: "government takeover"

A new website, Taxpayers Against Insurance Bad Faith, provides a sign that opponents of "bad faith" reform are preparing for a fight.  The angle of this "patriotic" site is that bad faith reform will result in "government takeover of insurance claims" and "We are opposed to any government takeover of insurance claims."

Impact of Bad Faith Lawsuits on Florida Consumers

George Meros, Jr., GrayRobinson, Tallahassee, released a report from Berkeley Research Group: The Impact of Bad Faith Lawsuits on Consumers in Florida and Nationwide. It will be used in support of the bad faith reform legislation proposed for the 2011 session.  In releasing the report Meros stated: "Here is the economist's report on the adverse impact of bad faith litigation on Florida's consumers. Note that it correctly states that a bad faith verdict cannot be included in the rate base but goes on to show how Florida's bad faith laws have a devastating financial impact nonetheless."

The report is at this link:  William Hamm study - The Impact of Bad Faith Lawsuits on Consumers in Florida.

"Judicial hellhole" status not reason to trust insurance companies?

The 2010/2011 report on "judicial hellholes" -- showing South Florida at #4 -- appears at this link: http://www.judicialhellholes.org/

In a letter published by the Sun Sentinel, Broward plaintiff attorney Gary Farmer writes an opposing view to the claim that Florida is a "judicial hellhole."  Farmer, who is also an officer of the Florida Justice Association, writes:  "Earlier this month, the insurance industry spin machine started up again. If you believe them, every woe in our state — from traffic in South Florida to the cold weather in the Panhandle — is somehow the result of lawsuits. Some even call Florida a 'judicial hellhole,' claiming that Florida can lower costs for consumers and create jobs simply by reducing lawsuits.  Well, ask yourself this one question: Why in the world would you trust anything your insurance company says? Here are the facts: . . . "

Farmer's letter appears at this link:  http://www.sun-sentinel.com/news/opinion/fl-insurance-companies-forum-20110102,0,3953007,print.story