Reality check: Insurers are doing just fine. They even contributed $7 plus million to Florida politicians last year. Furthermore, the amount of insurance premiums paid by customers has little to do with accident claim payouts. It has a lot more to do with insurer profit margins.
Time and again, we’ve seen legislation enacted that makes it harder to sue and collect fair compensation against negligent motorists, businesses, and doctors – but fails to lower insurance premiums. Take for instance the Florida law passed in 2003 to limit medical malpractice pain-and-suffering damage payouts. At the time, state lawmakers insisted there was a “crisis” facing medical malpractice insurers that forced the industry to charge doctors super high premiums, to the point doctors had no choice but to relocate their practices out-of-state. This was all justified by basically arguing that greedy patients and plaintiff lawyers were exploiting medical malpractice insurance for big bucks. In a 2014 overturning of those damage caps, the Florida Supreme Court blasted lawmakers for their initial reasons for passing the law – while also noting it never made a dent in doctors’ insurance bills. In Estate of McCall v. U.S., the Court called the lawmakers’ justifications “arbitrary” and “irrational,” and an “offense to the fundamental notion of equal justice under the law.” In that 5-2 opinion, the court noted the effect of saving a modest amount for many meant imposing devastating costs on the few – namely those catastrophically injured. “If there ever was an alleged medical malpractice crisis” in the first place, the Court remarked skeptically in its reversal, there wasn’t one anymore.
But state lawmakers haven’t stopped trying to use this as a justification for ongoing efforts to make life easier for insurers. In the years since, they’ve continued pressing measures reducing both liability and damage awards for dangerous property conditions, car accidents, and work injuries. They’ve also targeted payouts from life and health insurance.
Now, proponents of this new law have promised that it will help eliminate the so-called “tort tax” imposed on citizens – something that doesn’t actually exist.
As you can imagine, our Fort Myers personal injury lawyers are among the many trial lawyers who strongly opposed this legislation. We believe that these new laws will disenfranchise people who have suffered serious injuries because of someone else’s wrongdoing. It’s not just lawyers, though. Other vocal opponents include doctors, bicyclists, and previous car accident victims – many of whom showed up in significant numbers at state committee hearings on the issue.
What Exactly Will this the Law Do?
The legislation – House Bill 837 and Senate Bill 236 – has made it more difficult to file, win, and fairly collect on well-founded Florida injury lawsuits. These bills were fast-tracked by lawmakers and quickly signed into law by Governor Desantis.
This new law has overturned a 130-year-old statute aimed at leveling the playing field between insurance policyholders and insurance companies. This is a major problem because it goes against the well-established wisdom recognizing that insurers who write the policies (and have far deeper pockets than policyholders) have the power in an insurance claim situation. So if the policyholder is forced to sue to get the insurance company to pay up according to the terms of a contract they wrote – and wins – the insurance company is compelled to pay attorney’s fees.
The new law requires the policyholder to cover their own attorney’s fees.
In effect, this means there are no real consequences for denying claims. If the insurer chooses not to pay and gets sued – what’s the worst that can happen in most cases? They have to pay up – without having to cover attorney’s fees. So whether they pay claims upfront or just issue blanket denials – same difference. Policyholders will also be less inclined to fight back because plaintiff lawyers will find it harder to justify taking on their cases – even strong ones.
Another change in the new law caps how much a plaintiff could collect in a lawsuit. Florida follows a system of pure comparative fault, as outlined by F.S. 768.81. That means if you’re in a crash wherein you were 30 percent at-fault and the other driver was 70 percent at-fault, you’d collect $70,000 on a $100,000 claim. Pure comparative fault means you can be found up to 99 percent at-fault and the other party will still have to pay their 1 percent portion of the damages. It keeps everyone accountable for their own actions. However, this new law puts a 51 percent bar on that fault. That means if you’re found 51 percent at-fault and the other driver is also found 49-percent at fault, the other driver doesn’t have to pay a dime.
Motorcyclists especially have taken issue with this, given that they might be found 51 percent at-fault for their own brain injuries for not wearing a helmet – even if the crash wasn’t their fault and even though helmets aren’t required by law for motorcyclists.
Additionally, caps on reimbursement for plaintiff medical bills are imposed. Jurors deciding these cases wouldn’t be allowed to see the plaintiff’s actual medical bills. Instead, they only see what insurers had negotiated for those services. That’s going to result in failure to recover adequate compensation for injuries – especially for those on Medicaid or who are uninsured. Those rates aren’t adequate to cover needed care, particularly for catastrophic injuries.
Another portion of the law addresses something called bad faith insurance. These are cases where insurance companies are held accountable for not engaging in good faith dealings with their policyholders – denying legitimate claims, demanding excessive paperwork, or failing to respond to claimant requests in a reasonable time. There aren’t many of these cases in Florida and not many lawyers with the skill to successfully pursue them. But when they’re won, insurers may be compelled to pay out tens of millions of dollars – and insurers can’t pass that cost onto consumers. This law has made several changes. Policyholders aren’t allowed to sue insurance companies for bad faith if they issue an offer to settle within 90 days. Small business owners are primarily concerned as this is a problem because if they’re sued and their insurer doesn’t engage in good faith settlement negotiations, they are stuck holding the bag.
The fact is, the tort cases that are winning – in settlement negotiations and trial – are doing so because they are legitimate. Personal injury litigation is not an “easy win” as it is as the plaintiff has the burden of proof. This new law has made it more difficult to prevail with fair compensation for legitimate claims and serious injuries.
If you are injured in a Fort Myers, Port Charlotte, Sarasota, Cape Coral, Naples, or Key West motorcycle accident, contact our injury attorneys at Garvin Injury Law at 800.977.7017 for a free initial consultation.
Additional Resources:
Florida lawmakers want to help insurance companies by limiting lawsuits, March 14, 2023, By Lawrence Mower, Tampa Bay Times
More Blog Entries:
Can Both Drivers Be At-Fault in a Fort Myers Car Accident?, Dec. 22, 2022, Fort Myers Injury Lawyer Blog