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Hurricane Ian expected to push more property and casualty insurers out of business

Six property and casualty insurers have gone bankrupt in Florida this year, and more are on the brink of bankruptcy in the aftermath of Hurricane Ian.

“Could Hurricane Ian cause more Florida companies to go out of business? Yes,” said Mark Friedlander, a spokesman for the Insurance Information Institute, a nonpartisan research organization. “The reason is the lawsuit, not the actual claims being paid.”

Ian has dealt a heavy blow to Florida’s already crippled property insurance market.A Category 4 storm is expected to subside as one of the costliest in U.S. history, resulting in Many of the state’s private insurance companies are expected to go out of business.

Ian is likely to be the second-costliest hurricane to hit the United States on record, costing insurance companies more than $60 billion, Friedlander said.

“The breakdown of the $60 billion loss is as follows. We expect approximately one-third of the total loss, or $10 billion to $20 billion, to be related to litigation costs,” said Friedlander. The state is in danger of shutting down.

A record 116,000 property-claim-related lawsuits were filed in Florida last year. Friedlander says that number was expected to reach 130,000 this year, but that was before Ian. “Additionally, there will be thousands of claims related to Hurricane Ian.”

Florida legislators will meet in mid-December to work on stabilizing the state’s property insurance market.

“Until the law is changed and stricter regulations are put in place, the level of litigation and claim fraud in the state will continue to rise.”

Friedlander said the insurance industry wants to get rid of “one-way attorney fees” that insurers must pay if they lose a claims dispute.

Members of Parliament can do so when they meet during the special legislative session on December 12-16.

However, no policy change is expected to lower interest rates for at least several years. “There are already so many lawsuits in the pipeline,” Friedlander said. “In some cases, it can take years for lawsuits to play out in the court system. increase.”

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