Editor’s Note: This regular department in AGRR magazine focuses on areas where auto glass and insurance intersect and how insurance practices affect both industries’ mutual customers.
Florida Assignment of Benefits Ban Curbs Lawsuits
Lawsuits in Florida about glass, especially lawsuits against insurance companies, have dropped substantially since the passage of legislation banning the assignment of benefits (AOB) in 2023.
According to state data shared by the insurance lobbying group Florida Justice Reform Institute (FJRI), 83% fewer cases hit the courts in 2024 than in 2023.
Florida passed the AOB legislation in 2023 to curb lawsuits. It bans auto glass companies from offering “items of value” to customers in exchange for insurance claims.
Attorney Ashley Kalifeh, who monitors court statistics on behalf of FJRI, told the recent Florida Chamber of Commerce Annual Insurance Summit that around 10,000 auto glass lawsuits were filed by the winter of 2024 in Florida. She said the final number from 2023 was about 60,000.
One reason for the notable decrease is that the number of auto glass suits in 2023 was unusually high. The Washington Post reports that in 2021 and 2022, there were 25,414 and 34,320 windshield lawsuits in Florida, respectively. The new legislation caused the initial spike, Kalifeh explained, but it has now been in effect long enough for the trend to swing the other way.
2014 is the most recent year with comparable cases to 2024. About 10,225 auto glass lawsuits were filed that year.
“Peace of Mind” or Piece of Big Brother?
One insurer has introduced a feature to provide extra aid to those in major accidents. Progressive Insurance recently launched its Accident Response feature on the company’s app.
According to company officials, if drivers choose to opt in, the app uses sensors on their phones to detect if they’ve been in a major accident. If so, Progressive will contact the driver to see if they need any help. The driver can then request emergency services or a tow truck, and Progressive will automatically submit a claim for the incident.
Officials say that if the driver doesn’t respond to the company’s attempts to contact them, it will send emergency services to the location where the app detected a serious crash.
Lawsuit Gives Glimpse of Insurance Practices
A Florida appellate court ruled at the end of 2024 that a shop could not pursue punitive action in a lawsuit against Progressive Insurance. The case closely examined Progressive’s pricing, appraisal and third-party administrator practices.
Lloyd’s of Shelton Auto Glass in North Port, Florida, filed a bad-faith lawsuit against the insurer in 2020 for short payment. The shop later moved to amend its bad-faith suit and sought punitive damages from Progressive, which the insurer disputed and the court ruled against. Lloyd’s initially appealed the decision but has recently dropped the appeal.
During the lawsuit, the court reviewed Progressive’s method for determining pricing. According to court documents, Progressive corporate representative Mike Root testified the insurer uses National Auto Glass Specifications (NAGS) data to help determine what it pays for glass claims. When Root testified in 2022, he said the insurer applies a 52% discount to the NAGS rate.
“The NAGS benchmark pricing is typically higher than the market rate will bear,” he said.
Court documents say Progressive also regularly uses an appraiser to determine the value of a windshield replacement, according to evidence cited in the opinion. It requests that shops disputing the value do the same.
According to testimony from Progressive’s appraiser that was cited in the court opinion, the company hired the appraiser to perform appraisals regularly, and the insurer maintains a relationship with the appraiser’s auto glass business.
Lloyd’s of Shelton included a complaint against Progressive’s relationship with its third-party administrator (TPA), Safelite Solutions, in its accusations of bad faith. The court disagreed on whether or not the TPA’s tendency to direct consumers toward Safelite or Safelite-affiliated shops was “steering.”
The majority opinion cited a Florida law that allows an insurer to require a specific shop for repairs.
“An insurer that elects to repair a motor vehicle and specifically requires a particular repair shop for vehicle repairs shall cause the damaged vehicle to be restored to its physical condition as to performance and appearance immediately prior to the loss at no additional cost to the insured or third-party claimant other than as stated in the policy,” the law says.
A dissenting judge said that Lloyd’s of Shelton’s complaints about Progressive and Safelite Solutions were justified. The judge said that even Progressive’s appraiser referred to the TPA’s actions as steering.
“Safelite [Solutions] uses a lot of tactics to try and scare the insured into choosing Safelite,” the appraiser said. “And therefore, we call that steering because Safelite [Solutions] is constantly steering people to Safelite.”
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