By Lewis Nibbelin, Analysis Author, Triple-I
Texas lawmakers struggling to ease the state’s rising insurance coverage prices may discover helpful insights from Florida’s sustained dedication to authorized system abuse reform.
In recent times, Florida led the nation in claim-related litigation, accounting for 72 % of house owners’ insurance coverage lawsuits regardless of representing solely 10 % of house owners’ claims. This disparity fueled escalating premium charges and a multi-year insurer exodus, steering state lawmakers towards litigation reforms in 2022 and 2023. These reforms, amongst different issues, curtailed one-way legal professional charges and task of advantages (AOB) for property insurance coverage claims.
Put up-reform, dozens of house owners’ and auto insurers have filed for premium reductions within the state, with some carriers submitting cumulative reductions of greater than 20 %. Renewed market competitors from the 18 new property insurers within the Sunshine State additionally facilitated the bottom variety of insurance policies administered by Residents Property Insurance coverage Corp. – the state-run insurer of final resort – in over a decade, at a 50 % drop final yr from 2024 as a consequence of profitable depopulation to the non-public market.
Florida’s rising stability displays a gradual lower in nuclear verdicts (awards of $10 million or extra) and claims-related lawsuits, with each month of 2025 reporting a continued decline in newly filed litigation in comparison with the identical month the earlier yr, the state governor’s workplace stated in a assertion.
Texas insurance coverage premiums spiral
Not like Florida’s trajectory, Texas as soon as set the gold normal for a good and balanced courtroom system, main with a collection of Nineteen Nineties and early 2000s reforms that included a $250,000 cap on noneconomic damages in medical malpractice circumstances. Whereas this laws stays intact, continued efforts have stalled underneath repeated legislative challenges to preexisting and proposed reforms.
Final yr’s failed state Senate Invoice 30, as an illustration – based mostly on the same Florida measure – aimed to limit “phantom damages” by exhibiting juries the precise quantity paid for medical payments, reasonably than an inflated quantity decided by a healthcare supplier’s listing costs. Such quantities contribute to outsized injury awards within the state, which hosted the highest quantity of U.S. nuclear verdicts in 2024.
Insurers should account for these added prices when setting charges, resulting in a 19 % enhance in common Texas owners’ insurance coverage charges in 2024 after a 21 % spike in 2023, in accordance with Texas Division of Insurance coverage information. Analysis from the Insurance coverage Analysis Council – an affiliate of The Institutes, like Triple-I – ranked Texas because the sixth least reasonably priced state for owners’ insurance coverage in 2022, with owners on common paying 3.13 % of median family revenue for protection.
These traits earned Texas a spot on the American Tort Reform Basis’s (ATRF) annual “Judicial Hellhole” watch listing final yr, which highlighted “a wave of industry-targeted lawsuits” throughout the state. Noting that extra litigation additionally prices Texans a mean of $1,724 every year, ATRF president Tiger Joyce argued “Texas courts are in jeopardy — and it’s hardworking households who pay the value for lawsuit abuse.”
Texas policymakers would do properly to construct on the state’s observe document of significant reform and proceed pushing for laws modeled on Florida’s success. As a result of the Texas Legislature won’t meet once more till January 2027, the Lone Star State will stay a tough litigious surroundings for defendants and insurers alike for a while.
Study Extra:
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Litigation Reform Works: Florida Auto Insurance coverage Premium Charges Declining
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