Florida residents may qualify for compensation after insurers were found to be overcharging customers

Florida regulators are cracking down on insurance companies operating in the state, which could provide some relief to customers who, according to newly released legal documents, were overcharged on their premiums while others were undercharged. The state has also cracked down on companies that submitted late paperwork to state regulators.

The Florida Office of Insurance Regulation has opened investigations into various insurers operating in the state. They found that some of the policies offered were inconsistent with the state’s regulations, which led to the miscalculation of premiums. These investigations come as the state’s leaders are taking steps to hold insurance companies accountable to customers by addressing major structural issues within the sector.

The state is prone to powerful hurricanes, which have increased in frequency and power in recent years, so the cost of insurance policies has rapidly increased. In 2022, FIU News reported that insurance rates had doubled during the previous five years. Unfortunately, the companies operating in the state continued to report losses. However, FUI News’ Shahid S. Hamid found that in addition to the shocks caused by the uptick in major hurricanes, “the biggest single reason” for the price increases was the “‘assigning of benefits’ problem, involving contractors after a storm.”

“It’s partly fraud and partly taking advantage of loose regulation and court decisions that have affected insurance companies,” explained Hamid. Changes to state law were made to tighten the regulation, and the cases brought forward are meant to show insurers that noncompliance will be investigated.

Six companies on the hook to issue refunds

One of the main culprits was Liberty Mutual, which the agency has required to issue refunds of nearly $4.7 million to the 46,053 policyholders who were overcharged and will not allow the company to recover the funds from customers who were undercharged. Those who receive a check from Liberty Mutal should see it arrive by 15 June if they have not already received it.

The remaining cases, which cover five other insurance companies operating in the Sunshine State, are nowhere as large as the Liberty Mutual case.

State filings against Peerless Imdeminty show similar violations to those of Liberty Mutual but on a much lower scale. The company was only required to pay $76,000 in refunds to 879 policyholders who had been overcharged on their premiums.