Matthew Lavisky, a partner at Butler Legal, said that House Bill 1551 would reinstate a fee structure fostering conflicts of interest, with attorneys potentially prioritizing their financial gain over clients' benefits. The statement was made in a press release on March 18.
"The lawyer's interest in continuing litigation to realize his or her fee even when doing so does not benefit the insured any more than the settlement offer created a very real conflict," said Lavisky. "This system of lawyers determining the value of the services of lawyers led to hugely excessive ‘reasonable' rates for run-of-the-mill litigation. Lawyers are being paid from Florida's homeowner's premiums an amount that a teacher or firefighter might make in six months just to testify about how much another lawyer should be awarded. Cases became about the lawyers, not the insureds."
House Bill 1551 proposes reinstating attorney fee awards in insurance disputes, a move that has drawn criticism from industry experts. According to a report by Insurance Journal, opponents argue that this could reverse recent reforms aimed at curbing litigation abuses and lead to increased insurance premiums for consumers. Lavisky contends that such a structure incentivizes attorneys to prolong litigation for personal gain rather than resolving claims efficiently for policyholders.
Prior to the enactment of Senate Bill 2A in December 2022, Florida's one-way attorney fee statute allowed policyholders to recover legal fees from insurers upon winning a case. This system, as analyzed by Clyde & Co, led to a surge in litigation, with attorneys often receiving fees that far exceeded the amounts awarded to their clients, contributing to a destabilized insurance market.
The Florida Office of Insurance Regulation reported that following the implementation of Senate Bill 2A, there was a notable decrease in property insurance litigation. Commissioner Michael Yaworsky highlighted that these reforms aimed to reduce frivolous lawsuits and stabilize the insurance market, benefiting both insurers and policyholders.
Lavisky is a partner at Butler Weihmuller Katz Craig LLP, specializing in insurance defense and complex litigation. According to his firm profile, he has extensive experience representing insurers in disputes involving coverage issues, bad faith claims, and appellate matters. He has been actively involved in discussions on insurance reform and has published articles analyzing the impact of legislative changes on the industry.