Citizens stopped from forcing arbitrations
- CANA of Wilton Manors
- 4 days ago
- 2 min read
A Hillsborough County circuit judge reinstated an injunction that stops state-owned Citizens Property Insurance Corp. from forcing policyholders’ claims disputes to an arbitration panel that the company funds.
Circuit Judge Melissa Polo on Aug. 1 granted a temporary injunction requested by attorneys for Martin Alvarez, a Tampa man who was planning to sue the state’s insurer of last resort over its offer to settle his hurricane damage claim.
Polo’s order, rather than stopping action only in Alvarez’s case, barred Citizens from diverting any and all claims disputes to the state’s Division of Administrative Hearings (DOAH) and paused cases that were already underway. She ruled that Alvarez demonstrated a “substantial likelihood of success” in its claim that the practice violates policyholders’ constitutional rights to fair trials.
Polo also denied Citizens’ motion to move the trial to Leon County, where the company is headquartered.
On Aug. 5, Citizens filed a notice to appeal the decision to the 2nd District Court of Appeal, triggering an automatic stay of the injunction and allowing Citizens’ DOAH cases to proceed.
On Thursday, Polo ruled that failing to lift the stay while Citizens pursued its appeal “risks depriving policyholders of constitutional protections.”
After Thursday’s ruling, Citizens spokesman Michael Peltier responded, “We will certainly adhere to the order while it remains in effect. The DOAH process offers a fair and efficient venue for settling disputed claims and the statute that specifically authorizes Citizens to use DOAH is constitutional. We look forward to making our case on appeal.”
Alvarez’s attorney Lynn Brauer did not immediately respond to a request for comment about the latest ruling.
The DOAH system, approved by both Citizens’ Board of Governors and the Florida Legislature, is forced on Citizens policyholders through a policy provision they have no opportunity to reject.
By contrast, private market insurers can offer policy provisions — known as endorsements — giving them the right to divert disputes to arbitration, but those are typically in exchange for a premium discount and policyholders have the right to reject the provisions.
Under Citizens’ mandatory endorsement, policyholders surrender their rights to a “jury trial, access to courts, and due process on the breach of their contract claims” while being offered “neither a fair alternative nor a reduction in premiums,” Polo wrote in a four-page order.
Since 2024, Citizens moved more than 1,300 claims to the DOAH courts. A South Florida Sun Sentinel analysis in July found that Citizens prevailed in 47 of 51 cases that advanced to a final hearing prior to July 10.
Advised by their lawyers that the system sets them up to fail, a majority of policyholders either settle or drop their claims before advancing to a hearing, plaintiffs attorneys told the Sun Sentinel
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