Florida House Bill 1087, Filed on February 25, 2025, Proposes Changes to the Property Insurance Claims Process

By Douglas M. Cohen and Kelly M. Vogt

On February 25, 2025, State Representative Randy Maggard (R) of Florida House District 054 introduced HB 1087, which proposes amending Fla. Statute Section §627.7015 that governs the alternative procedure for resolution of disputed property insurance claims. HB 1087 proposes mandating a new procedure for resolution of disputed homeowners’ property insurance claims and would require insurers to notify policyholders of the mandatory procedures upon issuance or renewal of a policy.

In summary, HB 1087 states any policyholder may, for any claim that is “ripe, due, and owing,” file with the Division of Administrative Hearings (DOAH), whether represented by an attorney or not, a petition to resolve claims. The insurer is required to bear all the costs of conducting the procedure. Upon receipt of a petition, an Administrative Law Judge (“ALJ”) shall review it and dismiss any petition which does not on its face contain the minimum required information, including a good-faith certification that the policyholder has made a good faith effort to resolve the dispute and was unable to with the insurer. Motions to dismiss may be filed and state with particularity the basis for the motion in accordance with Florida Stat. Section 440.192 (5) (procedure for resolving benefit disputes under Florida’s Worker’s Compensation statute). Otherwise, within 14 days after receipt of a petition, the insurer must pay the requested claim or file a response to the petition with DOAH specifying all claims requested but not paid and explain the insurer’s reason for nonpayment.

HB 1087 dictates that the ALJ shall conduct proceedings in a manner consistent with the process outlined in section 440.25 (Florida Worker’s Compensation statute) except that an ALJ shall make a determination within 60 days after the filing of the petition of the policyholder’s coverage under the insurance policy.

HB 1087 also mandates that if a claim is submitted under a homeowners insurance policy and the insured has a separate windstorm or flood insurance policy, the homeowners’ insurer is the primary insurer that must pay the insured’s loss according to the terms of the homeowner’s policy and has the right to seek subrogation from the windstorm or flood insurer.

While HB 1087’s intent may be to streamline dispute resolution, the bill creates some confusion that could impact insurers, policyholders and the overall claims process. Some concerns include the removal of alternative dispute resolution in favor of a one-size-fits-all system, which may be problematic for more complex claims. Further guidance on how the new procedure will function is necessary to lessen inconsistent rulings and legal challenges. Identifying ALJs with the expertise in policy interpretation and estimation of damages will also be necessary. The appeals process is also not made clear, and allowing claims that are “ripe, due or owing” without defining those terms could force parties into disputes prematurely. Shifting primary responsibility to homeowner’s carriers for payments, regardless of other wind or flood coverage, could lead to misguided claim allocation and conflict among insurers.

Although the intent behind HB 1087 is to lead to earlier claim resolution and limit litigation, at this point, it does not provide clarity for implementation and leaves many questions for policyholders and insurers alike.