Florida Insurance Companies Penalized for Misconduct After Hurricanes: What’s the Real Story?

In September, Florida’s Office of Insurance Regulation announced that it was ordering penalties totaling over $2 million against eight insurance companies for the way they handled homeowners’ insurance claims after Hurricane Ian and Hurricane Idalia. The agency also reported that two additional investigations were still underway and could result in additional fines. Chief Financial Officer Blaise Ingoglia stated that the fines were “proof positive” that the agency was committed to holding insurance companies accountable.

However, analysts question whether the enforcement action was intended more as a public relations stunt than as an effort at reform. To understand why, it is helpful to look at the agency’s actions in the context of Florida hurricane insurance claims.

Examinations and Investigations

The Florida Office of Insurance Regulation, often referred to by the acronym OIR, is a state agency with the mission “[t]o promote a stable and competitive insurance market for consumers.” According to the agency’s vision statement, the OIR works to balance the public’s need for protection against the need to keep the insurance industry healthy and competitive.

OIR operates a Property and Casualty Market Regulation unit that examines and investigates the business practices of casualty insurers and “patterns of alleged violations of the Florida Insurance Code.” This unit can impose penalties and require companies to take corrective action.

The penalties announced in September were based on examination reports released by the unit over three months, from April 21 through July 21. These reports provide a review and analysis of the companies’ claims-handling operations but do not include recommendations about the enforcement action to be taken by OIR.

In September, fines were announced against:

• American Coastal Insurance Company- $400,000 (Examination Report released  7-18)
• American Mobile Insurance Exchange- $400,000; (Examination Report released 7-11)
• Centauri Specialty Insurance Company- $100,000; (Examination Report released 4-22)
• Clear Blue Insurance Company- $400,000; (Examination Report released 5-22)
• Monarch National Insurance Company- $325,000 (Examination Report released 4-21)
• Sutton National Insurance Company- $50,000; (Examination Report released 5-23)
• Tower Hill Prime Insurance Company- $250,000; (Examination Report released 7-21)
• TypTap Insurance Company- $150,000. (Examination Report released 5-23)

The agency reports that, in addition to collecting fines, it also works to secure monetary restitution for consumers, recovering over $660,000 in the first quarter of 2025.  But the fines and restitution combined represent only a small fraction of the premiums these insurers collect. This leads many analysts to question whether the agency’s actions will have any deterrent effect on the industry.  

Allegations of Mishandling Hurricane Damage Claims

The fines issued against these eight companies stemmed from claims arising from damage caused by Hurricane Ian in 2022 and Hurricane Idalia in 2023. Examinations revealed a variety of violations of insurance requirements, such as:

• Failing to comply with the 90-day deadline for paying or denying claims
• Not paying interest on late payments
• Using adjusters that were not properly licensed or approved
• Delaying or ignoring communication from policyholders regarding claims
• Failing to include the required information that informs policyholders about their rights

In many instances, the rates of repeated errors showed that these were not individual mistakes but had become a pattern of inappropriate conduct.

Rewarding Bad Behavior?

One development that analysts find disturbing in conjunction with the violations is that one of the companies cited, Monarch National Insurance Company, was essentially rewarded at about the same time it was censured. OIR issued a consent order against Monarch on August 28, finding that the insurer had violated the rules in seven different ways. Problems included failure to use authorized adjusters, failure to abide by deadlines, and failure to provide required information to policyholders. In the order, OIR noted that the agency has the authority to revoke or suspend an insurer’s certificate of authority, but can also issue a fine. Monarch was ordered to pay $325,000 in fines for the violations. While the order was signed on August 28, the report revealing violations was issued on April 21, so OIR was well aware of the violations in August.

Yet on August 22, just before issuing the penalty consent order, OIR issued another consent order authorizing Monarch to take over thousands of policies held by the state-operated Citizens Property Insurance Corporation. Although the agency knew Monarch was violating insurance rules, it still chose to reward the company by awarding it new business.

The Problem with Agency Conduct Examinations

In addition to questions about whether the fines and retributions collected are sufficient to protect insurance consumers in any meaningful way, analysts also question the examinations and investigations conducted by OIR. There is concern that these reviews focus on superficial regulatory requirements rather than harmful practices embedded in the insurance industry.

Consumers are not harmed as much by failure to include required disclosures in communications as they are by practices that seem specifically designed to devalue claims and minimize payouts. Evidence of programs and arrangements that would reveal these practices is seldom requested by regulators, leaving enforcement in the hands of policyholders working with insurance attorneys. It is necessary to dig deep to uncover evidence of bad-faith practices, and while regulators should engage in these types of investigations when a complaint is filed, they rarely do.

Experienced Legal Advocacy When Insurance Companies Mishandle Your Claim

The actions of OIR produce headlines that give hope to policyholders struggling to receive the payouts they deserve after damage from hurricanes and other covered incidents, but that hope often does not translate into any real assistance. If your insurance company is wrongfully denying your claim or violating insurance rules, the team at Ver Ploeg & Marino may be able to help resolve your claim and recover the resources you should be receiving under the terms of your policy. We invite you to schedule a consultation with a Miami insurance claim lawyer at our firm to learn about the assistance we can provide in your situation. Just call us at 305-577-3996 or contact us online to get started.

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