Florida’s Citizens Property Insurance Wins Most of Its Claim Disputes in Mandatory Arbitration — ProPublica

Final October, Peter and Linda Kilfoil returned from an in a single day journey and located water pooling within the kitchen of their Fort Lauderdale, Florida, residence. The pair couldn’t pinpoint the supply of the leak and had a tough time getting a plumber. So Linda Kilfoil referred to as their insurer, Residents Property Insurance coverage Corp.

The decision was the start of the Kilfoils’ journey by means of an alternate authorized universe arrange by Residents, a quasi-governmental insurer in Florida, to scale back its staggering authorized prices. On this state-sanctioned world, the judges’ salaries are funded by Citizens, the principles adopted in Florida’s circuit courts don’t all apply and the insurance coverage firm nearly at all times triumphs.

It’s a authorized panorama so fraught {that a} Tampa decide just lately paused all its proceedings — twice. However that didn’t come quickly sufficient to assist the Kilfoils.

Residents despatched an adjuster to their residence the day after they referred to as. He couldn’t pinpoint the supply of the leak both however suspected it was coming from a pipe that drained wastewater from the kitchen, he mentioned later in a deposition. He snapped pictures of the warped, soggy cupboards. A short time later, Residents denied their declare, saying that the harm to their cupboards was in keeping with a long-term leak, and that their insurance coverage contract excluded protection of such leaks — except they had been hidden.

Eleven days after the denial, the Kilfoils’ plumber discovered the leaking pipe within the residence’s exterior wall. It had been spilling water right into a recess between their kitchen cupboards and slab basis, data present. The overall value of restore has come near $40,000, in keeping with Linda Kilfoil and building estimates offered by her lawyer.

The Kilfoils had completely relocated to Florida from Lengthy Island to get pleasure from retirement. However with Peter Kilfoil ailing with prostate and pores and skin most cancers, his spouse confronted the prospect of dealing with repairs whereas tending to his well being.

“I’m a former doctor,” Peter Kilfoil mentioned in an interview from the hospital. “I’m not like some carjacker. They accuse me of letting that leak persist till it destroyed my kitchen.”

Simply earlier than Thanksgiving, the Kilfoils sued Residents. As an alternative of going to circuit courtroom, as most lawsuits towards insurers would, Residents routed their case to arbitration earlier than the Florida Division of Administrative Hearings.

On the floor, the change of venue — made attainable by a provision lawmakers empowered Residents to insert on the finish of most of its insurance policies — didn’t seem to be a giant deal. Legislators and Residents executives touted DOAH as advantageous for each shoppers and the insurer. Circumstances within the discussion board have a tendency to maneuver quicker, value much less and are determined by knowledgeable administrative legislation judges relatively than juries.

However in follow, owners pressured by Residents into DOAH have bother exercising key rights.

Decide Britney Horton stored the Kilfoils’ lawyer from deposing a Residents adjuster, siding with the corporate after it argued it had already made one other worker out there and produced “all non-privileged info.” The ruling disadvantaged them of a good alternative to research the denial, in keeping with their lawyer. On not less than 20 different events, DOAH judges have issued comparable rulings throughout a dispute’s fact-finding section.

As well as, some DOAH judges have denied motions requesting that they disclose any potential conflicts they could have as arbitrators. Some plaintiff’s attorneys say that has made it tough to belief within the impartiality of their choices.

And the discussion board’s guidelines make it unattainable for owners to drop their lawsuit with out Residents’ approval, except they withdraw their declare, a transfer that may result in courtroom prices and lawyer’s charges if not filed early within the course of. Some have felt pressured to go to last hearings the place they misplaced and ended up owing hundreds to Residents.

“You don’t must be a rocket scientist to determine one thing’s fallacious,” mentioned Chip Merlin, president of Merlin Legislation Group, a agency that represents insurance coverage policyholders.

In a written response to questions concerning the owners’ experiences, Residents spokesperson Michael Peltier defended the present course of.

“We consider the statute authoring the decision of claims by DOAH offers a well-established, neutral, and environment friendly course of for policyholders, who now not should wait practically two years, on common, for a decision of their declare,” he wrote.

With regards to depositions, the discussion board shouldn’t be “materially totally different” from Florida’s circuit courts, he added. And he defined that whereas owners are barred from dismissing their instances at DOAH — a transfer that may enable them to pursue the declare in circuit courtroom — they aren’t blocked from withdrawing their declare, a extra terminal maneuver. (Withdrawing, although, grants Residents an automated win and exposes owners to the danger of charges if it’s not executed quickly after a case is shipped to DOAH.) The corporate declined to touch upon particular person instances in litigation.

As of July 21, judges sided with Residents in additional than 90% of instances that made it to a last DOAH listening to the place either side introduced their case, in keeping with a ProPublica evaluation of courtroom data. (The steep odds had been first highlighted by the South Florida Sun Sentinel.) In circuit courtroom trials, Residents has received about 55% of the time over the previous 5 years, in keeping with data launched by the corporate.

Citing a procedural error within the request by the Kilfoils’ legal professionals, Horton declined to push again the date of the ultimate listening to after Peter Kilfoil had been hospitalized. She didn’t reply to a request for remark. Confronted with lengthy odds and failing well being, the Kilfoils settled their case for the nominal sum of $500 that Residents was providing, in keeping with their lawyer. “I used to be being a nurse to my husband every day,” Linda Kilfoil mentioned, leaving little time to handle residence repairs and struggle the insurer. “I couldn’t go away him.”

Peter Kilfoil died at 77 on Aug. 22, 2025.

Of the Residents instances resolved at DOAH between March 2024 and July 7, 2025, 78% led to a settlement, in keeping with information launched by the insurer. Half of all instances settled for $500 or much less to the policyholder, in keeping with that information. A further 28%, in keeping with Peltier, had been settled by Residents for a median of $30,000.

Residents’ prospects can not decide out of DOAH. Ultimately, the insurer intends to ship greater than 3,800 instances a 12 months there, in keeping with a funding proposal accredited by its governing board final 12 months. Since February 2024, it’s despatched over 1,500.

A mess of public companies in Florida contract with DOAH, counting on the executive legislation judges to resolve disputes. As a part of that course of, they pay the company for the salaries of judges who determine their instances, although they don’t play a job within the hiring of them.

However this system must survive stiff authorized challenges. Essentially the most profitable up to now comes from Tampa, the place a circuit courtroom decide in August reaffirmed a statewide injunction pausing DOAH hearings after a Hurricane Milton sufferer argued the corporate was violating his rights.

“Particularly, enforcement of the arbitration clause at problem compels insureds right into a discussion board that lacks neutrality, discovery, movement follow, and significant judicial evaluate,” Decide Melissa Polo wrote in her order.

Residents moved to disqualify Polo, arguing that she violated her impartiality as a decide by ruling the DOAH course of unconstitutional earlier than arguments could possibly be heard within the case. Polo denied the movement.

“We sit up for making our case on attraction,” Peltier wrote of Polo’s choice to pause DOAH proceedings.

“All people in This Room, All people within the State of Florida Backstops Residents”

As Florida’s insurer of final resort, Residents should take all comers who can’t get inexpensive insurance coverage by means of one other provider. It gained the flexibility to take disputes to DOAH within the spring of 2023, at a second of nice peril for the insurer. Successive hurricanes had gouged a gap within the Sunshine State, leaving a number of non-public carriers bancrupt — and leaving tons of of hundreds of their prospects with no alternative however Residents. By the tip of that 12 months, the not-for-profit insurer was serving greater than 1.2 million owners as one other hurricane season loomed. It additionally had greater than 18,000 excellent lawsuits filed towards it.

The corporate efficiently lobbied the Legislature to let it take instances to DOAH to be able to buffer it towards the crises. The verbiage granting Residents this energy was tucked into HB 799 — a broader Residents invoice that, amongst different issues, allowed it to lift charges quicker on some insurance policies — simply after its third studying within the Florida Home of Representatives Commerce Committee in April 2023.

State Sen. Jonathan Martin, a Republican and one of many invoice’s sponsors, mentioned Residents officers proposed the DOAH provision to him in a gathering in his Tallahassee workplaces. Former Florida State Supreme Courtroom Justice Ricky Polston, who had simply begun what could be a quick stint because the insurer’s normal counsel, was current on the assembly, Martin mentioned.

“He and Residents expressed the danger that they had been dealing with, identical to all the opposite insurance coverage corporations on the market,” Martin mentioned.

Polston would go away Residents that June to enter non-public follow. He now fees Residents not less than $500 an hour to defend it from authorized and constitutional challenges, together with ones to the DOAH proceedings, data present, and his agency has billed the insurer nearly $430,000 this 12 months. Polston didn’t reply to a request for remark from ProPublica.

That quantity, in keeping with Peltier, is minuscule in contrast with the $450 million the group has spent on authorized providers below contracts signed in 2021 and 2022. “The determine you point out of $430,000 displays lower than one-tenth of 1%,” he wrote.

There was little dialogue of the DOAH provision in committee or within the properly of the home, the place the laws initially handed 115-0. It wasn’t till HB 799 reached the ground of the Florida Senate on Could 1, 2023, that two senators began asking questions.

“This very broad language is unhealthy for the Residents policyholders,” mentioned Republican Sen. Erin Grall as she rose to supply an modification that will strike the language from the invoice. Foremost amongst her issues was that Residents policyholders could be giving up precious rights, like entry to the courts, with out getting something in return (non-public policyholders get a premium discount when they comply with arbitration in Florida).

After elevating her issues, she withdrew her modification, curbing dialogue. A couple of minutes later, Democratic Sen. Tina Polsky requested Martin, the invoice’s sponsor, to deal with Grall’s issues.

“In my view, Residents is specifically located,” Martin mentioned. “All people on this room, everyone within the state of Florida backstops Residents,” Martin mentioned, referring to a provision in Florida legislation that permits Residents to levy a price on each insurance coverage policyholder within the state, together with these of opponents, ought to the corporate ever discover itself wanting funds.

The corporate’s funds have stabilized within the intervening two years. It’s aggressively shed greater than half one million insurance coverage insurance policies, offloading them to personal insurers, and is right down to about 12,600 excellent lawsuits as of this June. And its DOAH program is increasing.

Judicial Financial system

Fort Lauderdale owners Yvonne Miller and Chaney Darric Keith needed to cease pursuing their declare towards Residents this 12 months.

Miller and Keith had intitially claimed that their bathe pan failed, a leak they mentioned broken partitions, baseboards and flooring. Residents had denied the declare. The pair had sued, however through the course of the litigation, it turned clear that not less than among the harm had come from a long-term leak from their showerhead, which might not be eligible for insurance coverage protection. The pair’s lawyer tried to get the case dismissed. However at DOAH, that may’t occur except each events agree.

“I don’t need to transfer ahead with this,” mentioned lawyer Lourdes Bloomfield at a Feb. 17 DOAH listening to. Bloomfield had already tried two occasions to withdraw Miller and Keith’s plumbing declare towards Residents, submitting motions to voluntarily dismiss the lawsuit and notifying the courtroom of the withdrawal of her shoppers declare. Decide Terry Slusher had denied each of them, the second for being filed just one enterprise day earlier than the listening to.

“So simply in order that I could make it clear for myself, Residents shouldn’t be keen to allow Ms. Miller and Mr. Keith to withdraw their declare at the moment?” the decide requested Residents’ protection lawyer, Holly Miller, a short while later.

“These are my directions, sure sir,” Miller replied, in keeping with a transcript of the courtroom proceedings.

As a result of the pair acknowledged they needed to withdraw the case and introduced no proof at their last listening to, the decide sided with Residents and ended up ordering that the owners pay $10,677 in courtroom prices.

Mary Ceron is one other house owner who tried to give up however ended up at a last listening to towards her will. As her listening to approached, her lawyer mentioned she requested a settlement the place both sides bore its personal prices, however mentioned Residents didn’t agree. So Ceron withdrew her declare at her last listening to, and afterward she acquired a judgment towards her for nearly $45,000 in prices and charges. Residents agreed to settle the case with out gathering the cash after the house owner appealed, in keeping with Ceron’s lawyer.

The corporate, Peltier mentioned, is in search of finality. Miller and Keith, he wrote, had initially tried to give up their case in a method the place it could be refiled, “and we don’t need that, we would like finality.” Anybody who desires to cease their DOAH proceedings can accomplish that, he mentioned, by withdrawing their declare.

Residents routinely pursues charges and prices towards people who don’t withdraw their declare early within the DOAH course of. DOAH judges have granted greater than 15 such requests, in keeping with a ProPublica evaluation of the company’s docket. After being introduced with an inventory of those instances, which included that of Ceron, Peltier wrote that the corporate pursues charges towards some people who withdraw “to discourage legal professionals from pursuing claims that lack benefit.” Some 11% of DOAH claims by means of July 7 had led to withdrawals or voluntary dismissals, in keeping with information offered by the corporate.

Specialists level out that Florida’s circuit courts enable for voluntary dismissals. “I’m not saying that what they’re doing is technically not in conformity with the principles, nevertheless it’s the one time I’ve heard it in an everyday normal civil case, akin to an insurance coverage dispute,” mentioned Jack Tuter, former chief decide of Florida’s seventeenth Judicial Circuit, who independently reviewed DOAH instances for ProPublica and spoke usually of the discussion board’s follow of barring voluntary dismissals that aren’t agreed upon by events.

A ProPublica evaluate of the DOAH docket revealed not less than 32 different instances by which house owner makes an attempt to drop their lawsuits had been met with resistance from Residents, forcing each events to rack up authorized prices.

“I believe that’s one of the vindictive issues, within the 14 years I’ve been doing this, I’ve seen an insurance coverage firm do,” mentioned Andres Correa, a plaintiff’s lawyer who felt pressured to go to a last listening to after Residents refused to conform to a settlement by which both sides bore its personal prices.

Settling for Much less

Jeffrey McShane is a former Navy pilot and nuclear engineer. This March, as a lunar lander carrying a payload he helped design was utilizing X-rays to watch the dance between Earth’s magnetic subject and the photo voltaic wind, he was troubled by one other concern: Was there any technique to win towards Residents?

Based on an architect’s report, in the middle of two weeks within the spring of 2024, a pipe burst below the lounge of McShane’s four-bedroom residence, after which his roof — which had been changed 4 and 6 years earlier — sprung a leak after a storm. The water shorted his air-con unit. Mildew bloomed. An insurance coverage adjuster he employed put the invoice at simply over $200,000.

Residents mentioned its coverage didn’t cowl among the property broken by the leak and mentioned different harm was resulting from put on and tear and improper set up. It refused to cowl the prices. “We discovered no proof to assist the house owner’s declare of water intrusion by means of the roof’s floor on April 3, 2024,” an engineer employed by the corporate wrote after visiting the property.

“I didn’t anticipate that the technical problem of navigating Residents’ claims course of could be far tougher than getting a spacecraft to the Moon,” McShane wrote in an electronic mail to ProPublica.

As his last listening to approached, McShane’s discovered that his possibilities of victory had been nearly nonexistent. No house owner, as much as that time, had received a DOAH case towards Residents. The insurance coverage firm was providing him $5,000 to settle. On the final second, he determined a last listening to was too dangerous and took the cash.

ProPublica heard from greater than two dozen plaintiff’s attorneys who mentioned their DOAH instances settled for lower than what a house owner would have gotten in state courtroom.

Peltier, the Residents spokesperson, supplied a distinct perspective on settlements at DOAH. On common, instances there accept about $18,000, in contrast with about $25,000 in state courtroom. However a few of that distinction, in keeping with Peltier, is because of older, pre-tort reform instances that carry extra legal responsibility for the insurer.

Stainton Williams has been equally befuddled by his interactions with Residents.

Based on his lawyer, Michael Citron, a plastic tarp has coated the roof of Williams’ North Miami residence for a lot of the previous 12 months. Williams, 92, is a Jamaican immigrant with end-stage kidney illness whose roof, elements of that are 9 and 19 years previous, started to leak after a interval of heavy climate in late September that coincided with the passage of Hurricane Helene. On Oct. 11, 2024, Residents denied Williams’ declare, writing that “we decided the harm sustained to your shopper’s property was attributable to storm surge ensuing from a hurricane.” (Residents’ insurance policies don’t cowl storm surge or floods.) Williams’ house is about 3 miles from the ocean, on the other aspect of the state from Hurricane Helene’s important impacts and the place no storm surge or coastal flooding had been reported by the Nationwide Climate Service.

Inconsistently, an engineer employed by Residents to examine the property disputed that the roof was broken by Helene, writing “there was no harm to the roof protecting system or exterior envelope from Hurricane Helene.” The insurer’s spokesperson declined a possibility to make clear this seeming contradiction.

So Williams and his daughter, who has energy of lawyer, employed Citron and sued. When Williams’ case was despatched to DOAH, Citron filed a movement requesting, amongst different issues, that DOAH Decide Todd Resavage disclose any potential conflicts. The movement cites a state legislation that requires such disclosure from appointed arbitrators.

“The disclosures had been requested in our case as they’d be in any arbitration case,” Citron mentioned. “Why that turns into necessary on this continuing is as a result of we didn’t select the arbitrator. We didn’t even select arbitration. It was all executed by Residents. So due to that, we not less than need to know who these persons are, who’s overseeing our case,” he added.

Resavage denied the movement for 2 causes. First, he dominated the state legislation Citron cited didn’t apply as a result of he had not been appointed however relatively given his place by legislation. And even when that state legislation did apply, Resavage wrote, it wouldn’t require his disclosure except there have been “recognized info {that a} cheap individual would contemplate more likely to have an effect on the arbitrator’s impartiality.” He didn’t reply to a request for remark from ProPublica. A minimum of two different judges have denied comparable motions for disclosure, in keeping with a ProPublica evaluate of the docket.

Requested about his pondering and intentions with reference to battle of curiosity disclosures by administrative legislation judges, Martin, the invoice sponsor, responded through textual content with a query. “Do these judges must file a Kind 6? Like all different judges?” After being knowledgeable that DOAH judges file Kind 1, a much less detailed disclosure, Martin ceased responding to texts and didn’t reply telephone calls.