Florida Insurer Wins 90% of Mandatory Arbitration Cases, Raising Concerns Over Fairness to Homeowners

Florida Home Insurer's Arbitration System Criticized for Favoring Insurers Over Homeowners TALLAHASSEE, Fla. - In a system designed to expedite disputes between homeowners and insurers, Citizens Property Insurance has won more than 90% of the time in mandatory arbitration hearings, according to data obtained by ProPublica. This success rate is significantly higher than its win rate in court, where it prevails just over half the time. The figures have raised concerns about the fairness of the system, which allows insurers to bypass traditional courts and resolve disputes through a process that critics say favors them. "This is not arbitration; this is a rubber-stamp process," said Karen Clarke, a homeowner who had her claim denied in 2019. "It's like they're picking the judges." Citizens Property Insurance, the state-run insurer of last resort, has taken more than 1,500 disputes to mandatory arbitration since its inception in 2002. In these hearings, an independent arbitrator reviews the case and makes a binding decision. However, critics argue that this process is stacked against homeowners. "We're not saying that Citizens doesn't have valid claims," said Rep. Carlos Guillermo Smith (D-Orlando), who has been critical of the system. "But we are saying that when you give an insurer control over the process and the judges, it's a recipe for disaster." Background on Mandatory Arbitration Mandatory arbitration was introduced in Florida as part of a broader effort to streamline the insurance claims process. Proponents argued that it would reduce costs and expedite resolution for both parties. However, critics have long raised concerns about its fairness. Homeowners who opt out of mandatory arbitration are required to pay higher premiums or seek coverage from private insurers. This has led some to argue that the system effectively forces homeowners into a biased process. Implications and Next Developments The use of mandatory arbitration in insurance disputes raises broader questions about the balance between consumer protection and insurer interests. As states continue to grapple with rising insurance costs, policymakers will need to weigh the trade-offs between speed and fairness. Citizens Property Insurance has maintained that its system is fair and efficient, but the data obtained by ProPublica suggests otherwise. With more than 1,500 disputes resolved through mandatory arbitration, it remains to be seen whether changes are on the horizon for this contentious process. In a statement, Citizens spokesperson Michael Peltier said: "We believe our mandatory arbitration program has been successful in resolving claims efficiently and effectively." However, critics argue that the system's success rate is not just about efficiency but also about fairness. As policymakers and insurers continue to debate the merits of mandatory arbitration, one thing is clear: the fate of homeowners' rights hangs in the balance. *Reporting by Propublica.*