At long last, Florida property insurers may be thinking, state regulators have revised a consum
er complaint tabulation methodology that many had criticized as skewed, unrealistic and out of line with most other states.
Under Rule 69O-138.003, published last week, the Florida Office of Insurance Regulation w
ill no longer consider requests for claims-dispute mediation as official complaints. And only those complaints made by named insureds will be counted when tabulating a
carrier’s complaint index—a metric that can trigger market conduct examinations of carriers.
In the official language of rulemaking, the OIR will prioritize scheduling and conducting market co
nduct examinations of insurers based on several factors, the rule reads. These include “a disproportionate number of claims-handling complaints.”
An insurer is considered to have a disproportionate number when its complaint index is elevated in
three of the last four quarters. The index, in turn, is determined by comparing the number of claims-handling complaints to the number of open claims.
But now, for the first time, “a request made by a named insured, a named beneficiary, a representative of the insured or named beneficiary, or an insurer to p
articipate in any form of alternate dispute resolution process shall not be included when calculating the com
plaint index,” rule reads. Requests for service or alternative dispute resolution are made to the state Department of Financial Services.
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The rule change “makes sense because it ensures that the Office’s required market conduct exa
ms are based off of consumer complaints made to the FLOIR—and not based on service requests to DFS,” said Melissa Burt DeVriese, president of Security First Insurance, based in Ormond Beach.
The change will put the methodology in line with the intent of the governing statute, which emphasizes actual complaints from policyholders, DeVriese said.
Few, if any, other states consider requests for mediation or arbitration to be the same thing as cons
umer complaints about carriers’ conduct, Universal Property & Casualty Insurance attorney Travis Miller said last year.
“This has the effect of creating unwarranted perceptions of the Florida market, which we unfortunat
ely must explain from time to time to other states or organizations,” Miller said.
An examination of complaint numbers, provided by the Department of Financial Services, showed that fr
om 2020 to 2024, in the depths of the Florida property insurance crisis, consumer complaints about insurance companies more than doubled, to about 23,400.
But if requests for alternative dispute resolutions are left out of the count, the total number of complaints was much smaller: about 4,000 in 2020, rising only slightly by 2024.
