SB 914 – Relating to Property Insurance
On Tuesday, January 21, SB 914 by Senator Jeff Brandes (R-St. Petersburg) was heard by the Senate Banking & Insurance Committee and was reported favorable with 5 yeas and 3 nays. AIF’s Senior Vice President of State and Federal Affairs, Brewster Bevis, stood in support of this legislation.
The bill prohibits the use of contingency risk multipliers in property insurance policy disputes and provides that the maximum attorney fee a court may award for those claims is the lodestar amount. The lodestar amount, in this context, is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate for the attorney’s services on behalf of the insured or beneficiary. Further, the bill prohibits courts from considering contingency risk either as an element in calculating the lodestar amount or as a multiplier to increase the lodestar amount. Since 1992, the federal courts have maintained a consistent standard for contingency risk multipliers, and the US Supreme Court has strongly asserted that contingency risk multipliers should only apply in “rare and exceptional cases.” During the meeting, the sponsor offered an amendment that, rather than prohibiting the use of contingency risk multipliers, codified the federal standard that the multipliers may only be used in rare and exceptional cases.
SB 914 will now move to the Senate Judiciary Committee.
AIF supports legislative efforts that prevent unscrupulous actors from taking advantage of property insurance disputes which keeps insurance rates low and allows growth in Florida businesses.