Gallagher Re Report Details Florida’s Insurance Market Turnaround After Tort Reform

Gallagher Re's report, Florida Tort Reform: A Sunshine Success Story, analyzes how legislative changes enacted in 2022–2023 have revitalized Florida's property insurance market. According to Gallagher Re, reforms eliminating "one-way" attorney fees, restricting assignment of benefits, and tightening rules on bad-faith claims have led to reduced litigation, improved insurer profitability, and renewed confidence among reinsurers and capital providers. 

Per the report, Florida's legal system had long been considered one of the most challenging in the United States, with the state accounting for 76 percent of homeowners insurance litigation nationwide despite only 6.9 percent of total claims. The combination of high litigation costs, unprofitable underwriting, and increasing reliance on the state's insurer of last resort, Citizens Property Insurance Corporation, prompted lawmakers to introduce sweeping reforms under Senate Bill 2–A and House Bill 837. 

According to Gallagher Re, these legislative measures have produced tangible results. The number of property insurance lawsuits has dropped sharply, returning to 2019 levels. Insurers' defense and cost containment expenses fell to 3.4 percent in 2024, the lowest in nearly a decade, while Florida's domestic property insurers collectively reported their first annual profit since 2016. 

The report also noted that 14 new insurance companies have entered Florida's market since the reforms were enacted, bringing more than $400 million in additional policyholder surplus. Citizens' policy count has decreased by one-third within a year, with its exposure dropping from $520 billion to $295 billion, indicating a healthier private market. 

Gallagher Re reported that the June 1, 2025, reinsurance renewal period saw average risk-adjusted price decreases of 10.7 percent, with reductions across all program layers. Improved legal and regulatory stability, combined with increased reinsurance capacity, has led reinsurers to view Florida as a more sustainable and attractive market for capital deployment. 

According to the report, primary insurance rates are also beginning to reflect these improvements. Data from late 2024 showed the first average homeowners rate decrease in 2 years, with 27 insurers filing for reductions since early 2024. Gallagher Re said this marks a turning point, suggesting the benefits of tort reform are now flowing through to consumers. 

The paper concluded that Florida's reforms may serve as a model for other states seeking to address excessive litigation and high insurance costs. Gallagher Re highlighted that states such as Georgia, Louisiana, and Colorado have already initiated similar legislative efforts aimed at stabilizing insurance markets through tort reform. 

Gallagher Re stated that these developments have restored balance to Florida's insurance ecosystem, making the state once again a viable and competitive destination for re/insurance capital.