Florida Senate President Mike Haridopolos opened the 2011 StateLegislative Session late last week, beginning a new round in thereform fight for the insurance industry.

From sinkhole claims andreinsurance to the state's last-resort insurer and auto-insurancefraud, there are at least a half-dozen bills the insurance industryis watching closely.

The measure gaining the most attention is SB 408, this year'somnibus property insurance reform bill that addresses many of thesame issues contained in last year's SB 2044—a bill vetoed by former Gov. Charlie Crist despite widespreadsupport among lawmakers, regulators, trade groups and consumeradvocates.

Provisions within SB 408 gaining the most attention centeron sinkholeclaims—an issue that was left out of SB 2044 in hopes thatpassage would be more likely.  

Sinkhole claims have become a huge problem for property insurersin Florida, and studies by the Office of Insurance Regulation (OIR) and theSenate Banking and Insurance Committee have backed up insurers'claims that the issue is worsening.

According to the Florida Insurance Council (FIC), which supportsSB 408, the bill also requires insurers to carry more surplus,modifies replacement-cost methodology, limits the time a claim canbe filed after a hurricane to three years, reforms mitigationdiscounts and sets new rules for public adjusters (who worked with lawmakers on the language inthe bill but who remain concerned about the sinkholeprovisions). 

It looks as though lawmakers will also decide on a bill designedto restore Citizens Property Insurance Corp. as the true insurer oflast resort in the state. Citizens has become the state's largestproperty insurer, but SB 1714 looks to adjust caps on gradual rateincreases outlined in legislation adopted two years ago.

The proposed bill could increase the cap on Citizens' rateincreases per policyholder to 15 percent from 10 percent and repeala law allowing a policyholder to veto "takeouts" that have beennegotiated by the OIR. Certain companies in Florida are authorizedas "takeout companies" and are permitted to select policies fromCitizens—but policyholders have the right to refuse.

FIC said another bill is being drafted to tackle auto insurancefraud due to people taking advantage of the state's personal injuryprotection (PIP) system.

The Sunshine Alliance to Erase Fraud is working on a bill to introduce during the legislative session.The group was started by FIC, Consumer Federation of the Southeastand the Coalition Against Insurance Fraud.