TALLAHASSEE — As Florida Chief Financial Officer Jimmy Patronis accelerates his efforts toward additional assignment of benefits (AOB) reform, the Personal Insurance Federation of Florida (PIFF) says it is on board with a renewed effort to overhaul the law relating to auto glass claims.
The proposed legislation to reform AOB for auto-glass claims piggy backs with legislation passed in 2018 by the Florida Legislature that primarily limited attorney fees in homeowner AOB lawsuits, which have increased in recent years.
PIFF President and CEO Michael Carlson says that publicly available data shows a sharp rise in auto glass related lawsuits.
"There's a cottage industry of glass shops, many of which are owned by an entity in Arizona, that are preying on consumers," Carlson recently told the Florida Record.
Carlson said these shops offer consumers "quick auto glass fixes" as well as gift cards and other enticements in order to get them to sign over AOB.
According to Carlson, many times these companies replace the glass without any notice to the insurance carrier for review. Carlson said this has led to insurance companies getting invoices for the glass repair and, when they question the price, they are sued. Carlson said a handful of Florida law firms are handling a large portion of the suits against insurers.
Settlements being sought in the lawsuits are typically for $200 for the vendor with the attorney getting $2,000. He said the glass company can exceed "market price" even though the insurer is aware of the market price and has limits on what should be paid on these claims.
"This is more about a portion of the trial bar seeking litigation for profit," Carlson said.
Carlson noted that language in the AOB reform bill that passed earlier this year in the Florida Legislature involved property insurance claims and initially included auto glass reform, but got sidelined.
"This runaway litigation is really unnecessary," Carlson said. "A lot of areas of the civil justice system in Florida are open to abuse. The courts should not be used as a proxy for changing the way the market works. A lawsuit scheme is in play that rewards attorneys more than the vendors."
When asked about Safelite being used by a majority of insurance carriers as a third party administrator and the risk to healthy competition in the market place, Carlson said Safelite is a legitimate company that provides auto glass repairs for insurers and is convenient to use. He said many AOB lawsuits are filed by glass repair companies that are not able to compete with Safelite and seek additional funds via lawsuits.