FIGA - Florida Insurance Guarantee Association
The Florida Insurance Guarantee Association is a nonprofit organization that helps pay claims for policyholders who have had their insurers go out of business. When Hurricane Irma hit Florida last year, the state's insurance guaranty association stepped up to help homeowners whose homes were damaged by the storm. It paid more than $1 billion in claims.
How did it begin?
The Florida Legislature created the FIGA in 1970 to help protect consumers from financial losses resulting from the insolvency of an insurer. At first, the association was funded by assessments of all insurance companies doing business in Florida. In 1983, the legislature amended the statute and required only those insurers with assets below $500 million to contribute funds to the association.
In 2017, the state legislature passed a law requiring all insurers to offer policies with a $1 million limit per person and a $2 million limit per accident. It was done to ensure that Floridians had access to adequate coverage when needed.
Today, FIGA has more than 1,000 members, including most major property/casualty insurers operating in Florida. Most of these members are self-insured or insured through captive agents.
In addition to its members, FIGA also works with state regulators, consumer groups, and others to promote transparency and accountability among the industry's most prominent players. It also provides training and education programs to help agents understand the new technology and its best practices.
All FIGA members must be licensed as either surplus line carriers or directors' liability companies. Surplus line carriers are authorized to write business in states that do not maintain a physical presence. Directors' liability companies can sell insurance in Florida but cannot issue policies covering personal injury or property damage.
Writing a review about your insurance adjuster will require you to know their full name and adjuster license number. It’s always a good idea to keep accurate records on everyone you speak relating your insurance claim and repairs to your home. You can find reviews on your adjuster on www.reviewyouradjuster.com website to see how they treated prior insureds, and if there isn’t a review please let everyone know what your experiences were.
If your business has any financial services industry exposure, you need to become a member of FIGA. This association represents over 1,000 surplus line carriers and more than 500 directors' liability companies. It also provides education and training programs to help its members stay current with changes in the law and regulations affecting their businesses.
What does FIGA do?
When an insurer becomes insolvent, FIGA steps in to make sure policyholders are paid. If you have a claim against your insurer, you can file a claim with FIGA. You may also choose to file a claim directly with your insurer. However, if you do so, you will lose any rights you may have under your policy.
If you agree to file a claim with FIGA, you will receive notice within 30 days after filing stating how much money you might receive. Your claim will be processed according to the rules set for thin the law.
If you decide to file a direct claim with your insurer, you must provide proof of loss and other documentation required by your policy. You should contact your agent or broker for assistance. If you believe your claim is worth less than $5,000, you can file a claim directly with your insurer. If your claim exceeds $5,000, you must file a claim with FIGS.
If you decide to file your claim with your insurer, you must provide proof of loss and other documentation required by your policy. It includes a signed statement describing what happened and why you think you should be compensated. It also requires supporting evidence such as photos, receipts, bills, etc.
How is it funded?
FIGA receives its funding from assessments levied on each member. Each member pays a percentage of their annual premium based on the number of assets owned by the member. For example, if a member has $100 million in assets, it would pay 10 percent ($10 million) of its annual premium.
In addition to this assessment, FIGA collects a surcharge from each member equal to 5 percent of the total evaluations collected. These surcharges are used to cover administrative costs associated with the operation of FIGA.
FIGA also receives income from reinsurance agreements. Reinsurance agreements are contracts between two parties: one party agrees to pay another party a certain amount when a third party incurs an expense. Reinsurance payments are made to FIG whenever an insurer becomes insolvent. Reinsurance payments are calculated based on the number of premiums the insolvent insurer wrote in Florida.
Insolvent insurers who did not write enough insurance in Florida to qualify for reinsurance payments are assessed a higher rate. The average reinsurance payment received by FIGA last year was $1.4 billion.
How does it work?
FIGA's primary responsibility is to ensure that policyholders are paid their claims. To accomplish this goal, FIGA uses three main tools:
- Claims administration - The claims administrator reviews all claims submitted to FIGA and determines whether they are valid. The administrator will notify the claimant of their claim status if the claim is reasonable.
Claims administrators review all claims submitted to FIGA to determine whether they are valid. They also ensure that each suit has sufficient documentation to support its validity. If a claim is determined to be invalid, the claims administrator sends a letter to the claimant explaining why the claim was denied. This process ensures that claimants understand what happened with their share and provides them with the opportunity to appeal the decision.
- Legal services - FIGA provides legal representation to policyholders and claimants throughout the claims process. This representation includes helping claimants obtain information about their policies, preparing proofs of loss, negotiating settlements, and representing them at trial.
In addition to providing legal services to policyholders and claimants, FIGA also offers a range of risk management solutions to help insurers manage their loss exposure. These include underwriting, reinsurance, claim administration, and actuarial consulting services.
- Risk management - FIGA works closely with state regulators and insurance industry leaders to help prevent future insurer insolvencies. In particular, FIGA monitors the solvency status of insurers writing property/casualty insurance in southeast Florida.
In addition to working with regulators, FIGA also provides training and education to insurers about the risks associated with reinsurance contracts. It helps them avoid making costly mistakes when entering into reinsurance agreements.
What happens if I don't have insurance?
If you do not have insurance coverage for losses caused by a covered peril, you may still be able to recover damages under Florida's Uninsured Motorist Act. However, you may only cover up to $50,000 per person and $100,000 per accident under this act. Most people who do not have insurance coverage can recover more through personal injury protection (PIP) benefits available through their auto insurance policy.
Florida law allows individuals injured in motor vehicle accidents to sue the driver of the uninsured car even if the accident was not the driver's fault. To qualify for such recovery, however, the individual must prove that they suffered injuries due to the accident. This requirement makes sense because the Uninsured Motorist Act aims to protect people injured by drivers whose cars are not insured. It does not make sense to allow someone to claim damages when his negligence caused him injury.
What happens if my claim isn't covered?
If FIGA does not cover your claim, you may still be able to recover from your insurer. If your claim is denied, you may be able to appeal the decision and ask your insurer to reconsider. However, if your claim was rejected due to fraud or misrepresentation, you may be able to sue your insurer under the Unfair Claims Settlement Practices Act (UCSPA). This law protects consumers against unfair claims practices, including fraudulent statements.
The financial strength of an insurance company is essential to its customers. The Financial Stability Oversight Council (FSOC), part of the U.S. Treasury Department, has recently taken steps to ensure that insurance companies maintain adequate capital levels. As a result, many states require insurance companies to hold a certain amount of capital.
For more information on Florida Insurance Guarantee Association please visit www.figafacts.com