What You Need to Know About Florida’s Senate Bill 76
The Florida Senate recently passed SB 76, which has a lot to say about the three-way relationship between homeowners, roofing contractors, and insurance providers. While the bill has not become law yet, should Governor DeSantis pass it, it will go into effect on July 1, 2021. Here is what you need to know about Florida SB 76.
A Brief Overview of SB 76
While several issues fall under the umbrella of SB 76, it primarily focuses on how Floridian homeowners can file claims for storm damage to their roofs. Up to this point, the relationship between policyholders and insurance providers has often been managed by third-party adjusters and contractors. Under SB 76, roofing contractors are no longer legally permitted to market their assistance with assessing storm damage, interpreting insurance costs, and speaking with a homeowner regarding what should be covered under insurance.
Additionally, SB 76 values the replacement cost of roofs over 10 years old at a significantly lower rate than roofs under 10 years old. In other words, an 11-year-old roof destroyed during a hurricane may only be reimbursed at 40% value. Under SB 76, homeowners would also have a time cap of two years (shortened from the current three) to file a damage claim for their roof.
Should an insurance provider fail to reimburse the claimant for the correct amount of money, the claimant (under SB 76) must notify the insurance provider 10 days before filing a lawsuit. The insurance provider then has an opportunity to make things right before the claimant may follow through with the claim.
Who Does SB 76 Affect?
Unfortunately, SB 76 doesn’t just affect homeowners or just affect contractors. It affects everyone. Contractors are limited in the services they can offer to homeowners, and homeowners have to jump through a lot of hoops to get their money’s worth from their insurance providers.
Negative Implications for Homeowners and General Contractors
While focusing on the negative is never fun, it is always good to understand what’s going on. Negative implications of Florida SB 76 include the following.
● Reduced communication between contractors, homeowners, and insurance providers
Contractors are typically heavily involved in the communication process between homeowner and insurance. After all, the insurance company is typically who pays the contractor for their repair work, so why would the contractor not be involved? Unfortunately, due to the restrictions placed on contractors under SB 76, homeowners can no longer receive an honest assessment of damage costs from a contractor. Instead, a separate licensed appraiser must enter the scene.
● Lower cash value on roofs over 10 years old
Perhaps one of the most negative implications of SB 76 for homeowners is that any roof over 10 years old immediately becomes less valuable in the eyes of the insurance provider. Depending on whether the roof is tile, concrete, metal, etc., the value can reduce by 30%-75% overnight.
● Time limit on when a roofing damage claim can be filed
At first glance, this point might seem logical. After all, why would a homeowner wait three years to file a roof damage claim after a storm? Actually, it often takes that long for a homeowner to even realize their roof suffered damage. Structural damage is often hidden, and it takes months of wear and tear before the resulting leaks are seen.
● Less return on investment for policyholders
Insurance is a funny business because both parties (policyholder and provider) always hope to come out ahead or at least break even. Unfortunately, if a homeowner only receives 25% of their roof’s value, they are likely paying a lot more money to their insurance provider on a monthly basis than they are seeing returned in the event of an emergency. This makes it difficult to justify the cost of homeowner’s insurance.
● No adjustment performed by an unlicensed contractor
SB 76 prohibits general contractors from encouraging homeowners to seek the professional damage assessment of a contractor or adjuster. General contractors may not solicit their services at all, in fact, and as a general rule must remain quiet regarding the entire payment portion of their work.
● Difficulty paying attorneys’ fees
Another area SB 76 affects is that of paying attorneys. Under this bill, homeowners who take their insurance claims to court may only receive a portion of their court fees back, even if they win the case. How does this work? Up to this point, if a homeowner wins their case against the insurance provider, the insurance provider is responsible for paying the homeowner’s costs for taking them to court. Under SB 76, the insurance company only has to pay for a percentage of the court fees as correlates to the amount of money won by the homeowner.
For example, if a claimant sues their insurance provider for $50,000 and only receives 20% of that amount, the insurance provider does not have to pay any court fees. If the claimant receives between 20%-50% of the amount they filed for, the insurance provider pays the percentage of court fees equal to the percentage recovered. If the claimant receives more than 50% of the disputed amount, the insurance provider is responsible for all court fees.
RAF’s purpose is to protect the rights and make heard the voices of honest, hard-working, independent contractors. Particularly when bills are passed that affect homeowners and those helping them, advocacy matters. Here at RAF, we advocate for professionals in the mold, fire, water, and wind damage industry. If you are interested in becoming a member of RAF or have any further questions, call us today.