Court ruling lets Citizens restart halted insurance dispute hearings statewide.
A recent decision from a Florida court has cleared the path for a large number of long-delayed insurance disputes to move forward. More than four hundred disagreements between Citizens Property Insurance Corp. and its policyholders had been sitting on hold for months. Now, the 2nd Circuit Court in Leon County has ruled that Citizens is allowed to send these cases back to the state’s Division of Administrative Hearings, often called DOAH. This ruling settles a question that had caused confusion across the state and had held up cases that many policyholders and lawyers were waiting to see resolved.
The issue began when a policyholder, Elmer Lombana, questioned whether Citizens had the right to require an arbitration process instead of the traditional court system. His challenge argued that this setup limited access to the courts. Around the same time, a separate constitutional challenge took aim at the same process. That second challenge led to a temporary order in August that stopped arbitration hearings across the state, bringing all related cases to a standstill.
Citizens asked the 2nd Circuit Court in October to decide whether the agency should be allowed to continue using DOAH for these disputes. The court reviewed the process, along with updates Florida lawmakers put in place in 2023. Those updates added language giving Citizens clear approval to use DOAH “proceedings” to handle disagreements tied to insurance policies. After looking at the law, the court found that Citizens was acting within its authority and that the earlier order stopping the process had gone too far.
Recent Florida court decisions have reached similar conclusions, finding that this type of system fits within state law. Florida statutes also support arbitration as a way to settle disagreements, as long as certain protections are in place for people taking part in the process. With this ruling, the court helps return the system to the structure lawmakers intended.
For Citizens, this decision affects both operations and finances. The insurer has said that DOAH cases are usually resolved in about ninety days. This is much shorter than the average timeline in state court, where cases can take close to two years to reach a final answer. When disagreements stretch on for long periods, fees for lawyers and other costs can rise quickly. The faster pace at DOAH can help lower the cost for both the insurer and the policyholder. In a state like Florida, where storms have led to years of high claim totals and steady pressure on insurance rates, any reduction in legal expenses can have a meaningful impact on the market.
Even so, the system has drawn some criticism. U.S. Rep. Maxwell Frost has raised concerns about how the current setup came to be and whether it puts policyholders at a disadvantage. He has noted that Citizens has won nearly every challenge brought through the DOAH system this year. His questions reflect a wider debate about how to balance speed, fairness, and access to the court system in a state with a complicated and often strained property insurance market.
Citizens holds a large role in Florida’s homeowner insurance space. In 2024, it wrote 14.84 percent of direct premiums for homeowners multiperil coverage, making it the largest carrier in the state. Universal Insurance Holdings Group, State Farm, Florida Peninsula, and Slide Insurance Group follow behind as the next largest companies based on market share. As Citizens continues to grow, changes in how it handles disagreements can ripple across the entire market.
Sources:
Florida ruling allows Citizens arbitration system to move ahead
Conflicting Rulings Leave Florida’s Citizens Insurance Claims Arbitration In Limbo
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