(NewsNation) — Florida lawmakers passed a property insurance overhaul this week in an effort to fix a system that has caused private insurers to leave the hurricane-prone state while saddling homeowners with the highest premiums in the country.
Insurance industry experts say the legislation will entice insurers to remain in a state that has already seen six providers go insolvent this year.
“The key goal at this point is to get the market stable so no more companies collapse; eventually we will get to more moderate rate changes,” said Mark Friedlander, the director of corporate communications for the Insurance Information Institute.
The bill, which Gov. Ron DeSantis is expected to sign, would provide $1 billion in taxpayer funds to provide carriers with reinsurance — think of it as insurance for insurance companies.
The legislation also removes “one-way” attorney fees that have made Florida an attractive place for frivolous lawsuits, Friedlander said.
Florida homeowners’ insurance claims account for 9% of the claims filed nationwide, but the state makes up nearly 80% of all the property claim lawsuits, the Insurance Information Institute found.
That threat, along with extreme weather risks, have made the Sunshine State an unattractive place to do business.
With a shortage of providers, average annual premiums have risen to $4,231 in Florida, which is triple the national average.
Legislators hope the latest overhaul will expand the number of options available to Floridians, which they say will lead to lower prices.
The bill also forces insurers to respond more promptly to claims and would increase the state’s oversight of insurers’ conduct after hurricanes.
The Associated Press contributed to this report.