Federal Judge Blocks Provision of Florida Property Insurance Law

Original article can be found HERE

While Florida’s SB 76 – a bill meant to curb the state’s rampant insurance fraud related to roof repair – went into effect earlier this month, a federal judge has blocked a key provision in the legislation from being enforced.

Following a recent hearing, Chief US District Judge Mark Walker found that the new law violated the speech rights of roofing contractors, after local contractor Gale Force Roofing & Restoration called for a preliminary injunction.

Passed on April 30 and made effective July 01, SB 76 prohibits a contractor from executing a contract with a residential property owner for a roofing repair or replacement unless certain notice is included. It also requires property insurers to include certain data regarding closed claims in their annual reports to Florida’s Office of Insurance Regulation, among other things.

The law introduces several other changes that help deter insurance fraud, but most notable among them is a provision that forbids contractors from soliciting homeowners to file roof damage claims through what it calls “prohibited advertisement.” Methods that fall under “prohibited advertisement” include emails, flyers, and pamphlets.

In a lawsuit filed last month by Gale Force, the contractor contended that it advertises to homeowners to encourage them to contact the company for roof inspections. This marketing approach would be in violation of the new law, Gale Force explained and added that the provision violates its First Amendment rights.

“The act is an unconscionable attack on the right for homeowners to receive truthful information about how to repair and pay for the repairs to remedy damage they may have to their property,” Gale Force’s attorneys wrote. “In reality, it is a thinly veiled attempt to prevent anyone from assisting homeowners from making valid insurance claims to repair their homes.”

Judge Walker held a hearing on Gale Force’s injunction request last Friday, and issued his ruling Sunday, The News Service of Florida reported.

“It is also clear that the threatened injuries to the plaintiff from banning plaintiff’s truthful commercial speech outweighs the state’s interest in preventing fraud, protecting consumers from exploitation, and stabilizing the insurance market,” Walker wrote.