Citizens Insurance Fights for Its Right to Arbitrate

Mandatory arbitration is proving to be an incredibly controversial topic in the world of property insurance. Citizens Property Insurance Corp. is fighting for its right to arbitrate claims disputes, but the public is concerned that this process isn’t quite fair. Now, Citizens is begging an appellate court to rule in its favor. But what will be the outcome? How could mandatory arbitration affect your property insurance dispute, and could a property insurance lawyer in Fort Lauderdale help you?

Lack of Arbitration Could Irreparably Harm Insurer of Last Resort

Citizens Property Insurance Corp. is the insurer of last resort in Florida and a foundation of the insurance industry. According to Citizens’ attorneys, this foundation could be shattered if it loses the right to enforce arbitration clauses on its many policies in Florida. This is the argument the organization is currently making in a Florida appellate court – and the stakes are high.

The truth is that a Florida homeowner and Citizens policyholder has a strong chance of successfully challenging mandatory arbitration. This comes straight from the mouth of the Circuit Court Judge, who noted that the homeowner showed a high “likelihood of success” in his arguments against mandatory arbitration. This argument hinges on the Florida Constitution, and the homeowner claims that mandatory arbitration represents a constitutional violation.

At the beginning, it seemed as though this court case was unlikely to affect anything anytime soon. An automatic stay halted the temporary injunction, thereby allowing Citizens to continue arbitrating claims until this case was over. However, the Circuit Judge immediately vacated the stay, which means that the temporary ban against arbitration went into immediate effect.

This understandably ruffled a few feathers at Citizens, and by the end of the week, representatives were back in court pushing back against this move. Specifically, Citizens’ counsel warned that this injunction could “irreparably harm” the insurer of last resort, forcing hundreds of ongoing negotiations to head straight to court. The insurer also argued once again that the plaintiff in this case agreed to arbitrate his claim when he paid his first premium after receiving his renewal package.

The Circuit Court Judge maintains that the arbitration process is “structurally biased” toward citizens – specifically noting that arbitration prevents “neutral discovery” and judicial review. Mandatory arbitration is still a relatively new concept in Florida, having been approved by the government in 2023. This move was a pro-insurance measure designed by lawmakers to lure insurers back to the Sunshine State. Some believe that litigation is causing premiums to increase.

Contact Our Fort Lauderdale Property Insurance Lawyers Today

At Fuxa & Tyler, our legal team is made up of a diverse combination of attorneys who are well-positioned to protect the legal rights and financial interests of policyholders. If your property insurance claim was denied, we can help. For a free consultation, please call us today at (954) 990-5251. With an office in Sunrise, we represent policyholders in Broward County and throughout the state of Florida.

Sources:

 orlandoweekly.com/news/floridas-citizens-insurance-says-it-faces-being-irreparably-harmed-amid-legal-battle-40269852

orlandoweekly.com/news/florida-now-faces-lawsuit-over-newly-passed-constitutional-amendment-restrictions-39455805