Florida insurance claims denials have reached record levels in 2024, with nearly 47% of claims closed without payment, according to recent data. This trend is contributing to a surge in lawsuits, high consumer complaints, and ongoing instability in the state’s property insurance market.

Florida Insurance Claims Denials and Litigation Trends

Florida’s property insurance market has long faced challenges due to frequent hurricanes, high litigation rates, and a large number of claims. In 2024, the percentage of insurance claims closed without payment climbed to almost 47%, a significant increase from 40% in 2022. This rate far exceeds the national average, which dropped to just 1.1% in 2024, according to industry data.

Lawsuits as a percentage of all closed claims also rose, reaching 6.2% in 2024 compared to 5% in 2022. The increase in litigation follows the implementation of tort reform in 2022, which aimed to reduce lawsuits against insurers and stabilize the market.

Impact of Tort Reform on Insurance Claims in Florida

In 2022, Florida enacted tort reform targeting property insurance litigation. The reforms made it more difficult for policyholders to sue insurers, with the goal of curbing legal costs and lowering premiums. However, the result has been an unexpected rise in both claim denials and lawsuits.

According to industry analysts, insurers have responded to the new legal environment by closing more claims without payment, anticipating that policyholders would have fewer options to challenge denials. This shift has led to increased frustration among consumers and a higher volume of lawsuits over unpaid claims.

Key Statistics on Florida Insurance Claims Denials

• 47% of claims closed without payment in 2024, up from 40% in 2022
• 6.2% of closed claims resulted in lawsuits in 2024
• 31,000+ complaints projected for 2025, more than double the number five years ago
• Some insurers denied over 40% of claims, with certain companies exceeding 47% denial rates
• National average for claims closed without payment is 1.1% in 2024

Hurricane Impacts and Coverage Gaps

Recent hurricanes, including Helene and Milton, have exposed significant gaps in insurance coverage for Florida homeowners. According to official reports, 56% of Helene residential claims and 43% of Milton residential claims were closed without payment. Most unpaid claims were related to flood damage, which is not covered by standard property insurance policies.

These events have intensified scrutiny of the insurance market and highlighted the importance of understanding policy exclusions, especially for flood damage and deductibles.

Flood Damage and Unpaid Claims

• Flood damage is typically excluded from standard property insurance
• Many policyholders discover coverage gaps only after filing a claim
• Unpaid claims often lead to litigation or arbitration

Consumer Complaints and Market Instability

Complaints about property-casualty insurers in Florida have more than doubled over the past five years. Projections for 2025 indicate that complaints will exceed 31,000, reflecting growing dissatisfaction among policyholders.

High premiums, aggressive claim denials, and delayed payments are cited as major concerns. According to regulatory agencies, the market remains unstable, with both consumers and insurers facing financial pressures.

Insurer Solvency and Regulatory Oversight

• Florida insurers face mounting costs from litigation and natural disasters
• Some companies are undercapitalized, raising concerns about solvency
• Regulatory agencies continue to monitor and propose reforms

Expert Perspectives on Florida Insurance Claims Denials

Industry experts report that tort reform has not reduced litigation as intended. Instead, the reforms have encouraged insurers to deny more claims, prompting policyholders to seek legal action. There is skepticism about labeling these lawsuits as frivolous, as the high rate of denials suggests genuine disputes over unpaid claims.

Experts also highlight the need for better consumer education about insurance coverage, especially regarding flood insurance and policy deductibles. Many homeowners are unaware of exclusions until after a loss occurs, leading to unexpected out-of-pocket expenses and disputes with insurers.

Calls for Improved Consumer Education

• Clearer communication about coverage limits and exclusions
• Encouragement for homeowners to consider separate flood insurance
• Resources to help consumers understand claim processes and rights

Ongoing Challenges and Regulatory Response

The Florida insurance market remains unique in its high rate of claim denials and litigation compared to other states. Policyholders continue to face some of the highest premiums in the United States, driven by the costs of litigation and frequent natural disasters.

Regulatory agencies are actively monitoring the situation and proposing additional reforms to balance insurer solvency with consumer protection. Details may be updated as investigations and regulatory reviews continue.

Frequently Asked Questions About Florida Insurance Claims Denials

What is the current rate of insurance claims denials in Florida?

Nearly 47% of property insurance claims in Florida were closed without payment in 2024, far higher than the national average of 1.1%, according to official sources.

How much have insurance complaints increased in Florida?

Complaints about property-casualty insurers in Florida have more than doubled over five years, with projections for 2025 exceeding 31,000 complaints.

Are lawsuits over unpaid insurance claims common in Florida?

Yes, lawsuits as a percentage of all closed claims rose to 6.2% in 2024, reflecting a growing number of legal disputes over denied or unpaid claims.

Can you get flood damage covered by standard property insurance in Florida?

No, standard property insurance policies in Florida typically do not cover flood damage. Homeowners need to purchase separate flood insurance for this type of protection.

Where are insurance claim denials most frequent in the United States?

Insurance claim denials are most frequent in Florida, with rates far exceeding those in other states, according to industry data and regulatory agencies.