TALLAHASSEE — The proportion of lawsuits filed against Florida’s state-backed property insurer from South Florida has plummeted in recent years a shift attributed to sweeping legislative reforms aimed at curbing what industry officials call frivolous claims.
Citizens Property Insurance Corp., which serves as the insurer of last resort for homeowners unable to find private coverage, reported that lawsuits originating from Broward, Palm Beach and Miami-Dade counties dropped from 88% of its total cases in 2020 to 55% in the first seven months of 2025. Statewide, the number of suits fell from 6,251 during January through July 2021 to 3,600 in the same period this year, according to the Orlando Sentinel.
The decline coincides with changes enacted by Florida lawmakers in 2022 and 2023 including the elimination of a long-standing “one-way” attorney fee rule that required insurers to cover plaintiffs’ legal costs if a settlement exceeded the carrier’s initial offer by even a small amount. Other factors include Citizens’ reduced market share in South Florida and a relative lull in major hurricane activity in the region.
“Citizens was incurring more frivolous lawsuits than other insurers because of its large market share in South Florida,” said Mark Friedlander, senior director of media relations for the Insurance Information Institute. “Now, Citizens is experiencing the biggest impacts of tort reform, curbing the abusive legal practices that caused Florida’s man-made risk crisis.”
Friedlander added that lower litigation costs have drawn 17 new insurance companies to the state and prompted most Florida-based carriers to seek rate decreases or hold premiums steady.
But plaintiffs’ attorneys contend the reforms have stacked the deck against homeowners and make it harder to challenge denied or underpaid claims. A key element is Citizens’ use of mandatory arbitration through the state’s Division of Administrative Hearings. This process bypasses traditional courts.
Since February 2024, Citizens has routed more than 1500 disputes to this arbitration panel, which it funds. An analysis of records shows the insurer prevails in over 90% of cases that reach a final hearing compared with about 55% in circuit court trials over the past five years. Roughly 78% of arbitrated cases end in settlements, with half awarding policyholders $500 or less.
Critics, including some lawmakers, argue the system lacks neutrality and strips homeowners of key rights such as taking depositions or dismissing cases without penalty. Republican State Sen. Erin Grall unsuccessfully pushed to scrap the arbitration provision in 2023, calling it detrimental to consumers.
A Tampa judge recently paused some arbitration proceedings, ruling the process unconstitutional due to potential bias and limited judicial oversight.
Citizens, which ballooned to over 1.2 million policies amid a wave of private insurer insolvencies following hurricanes like Ian in 2022, has since shed more than half a million customers. As of June, it held 777,592 policies, the lowest midyear total since 2021. In February, Gov. Ron DeSantis announced average premium reductions for Citizens customers, including drops in homeowners’ rates.
The changes come as Florida grapples with one of the nation’s highest property insurance costs, fueled by frequent storms, rising reinsurance prices and past litigation trends. Industry advocates say the reforms are stabilizing the market, while consumer groups warn they may leave vulnerable residents underprotected.
