Heritage Insurance adds an arbitration clause to its property insurance per annum Insurance magazine article, Another Florida insurer adds binding arbitration in the middle of losses.
The complaint came two months after OIR surprised many in the industry when they approved a recommendation from American Heritage Insurance Co., which offered arbitration in exchange for a premium discount for policyholders. But Heritage, which is facing weather losses and rising legal costs, seems to be taking it a step further, without mentioning any trade-off.
“If you and we do not agree on whether there is coverage for the loss, either party can request arbitration in writing,”; the inheritance note states. “An arbitration award shall be binding on the parties with respect to coverage and all damages and benefits that are due and due under the insurance.”
I recently wrote about this as an expected trend in, Will arbitration replace assessment in Floridawhere I noted:
Eleven states prohibit arbitration in property insurance disputes. Not Florida. Although I do not agree with the approval of the form, Florida’s general policy is to allow alternative dispute resolution including arbitration. Since the legislature has not taken up proposed bans on arbitration in the last three sessions and given the court’s approval of arbitration, the Commissioner may have found that this form of arbitration follows public policy.
This provision is a game changer. My prediction is that since the Florida Office of Insurance Regulation approved the form, many insurers will follow suit and apply for similar insurance language. If the courts allow the provision to apply, the answer to the question will be “yes”.
It looks like the trend is starting to pick up speed.
Do not follow trends, start trends.
– Frank Capra