Florida Property Insurance Litigation: Declining but Still Substantial After AOB and Legislative Reforms

Florida’s property insurance market has long been the most litigated in the nation, but recent legislative reforms have begun to change that narrative. While lawsuits have dropped significantly since the peak of 2021–2022, property insurance litigation remains a major factor in the state’s real estate and construction sectors. The combination of the Assignment of Benefits (AOB) reforms and new property insurance laws enacted in 2023 and 2024 continues to reshape how claims, coverage disputes, and contractor payments are handled in 2025—and will continue to influence the landscape into 2026.

A Brief Look Back: What Sparked the Crisis

For years, Florida’s insurance market suffered from rising premiums and a flood of lawsuits. Thousands of claims were being litigated over roof damage, water intrusion, and hurricane losses. A large portion of those suits involved “Assignment of Benefits” (AOB) agreements—contracts that allowed contractors, roofers, or remediation companies to stand in the policyholder’s place and demand payment directly from insurers.

The AOB system was meant to help homeowners get quick repairs, but it was often abused. Some contractors inflated repair costs or filed lawsuits before insurers could properly investigate claims. By 2022, AOB-related suits were overwhelming state courts, driving insurers out of the market and forcing major premium hikes for homeowners and associations.

AOB Reform and the 2023–2024 Legislative Overhaul

In response, Florida lawmakers passed sweeping insurance reforms targeting both AOB abuse and litigation costs. The most impactful changes include:

• A full prohibition on AOB agreements for property insurance policies issued after January 1, 2023.
• Elimination of one-way attorney fees, meaning each party now pays its own legal costs unless a contract or statute explicitly provides otherwise.
• Tightened timelines for insurers to acknowledge, investigate, and pay claims, reducing opportunities for delay-based suits.
• Streamlined mediation and appraisal procedures to encourage pre-litigation resolution.
• Creation of the Florida Optional Reinsurance Assistance (FORA) Program to stabilize insurers’ financial risk and promote new market entrants.

These measures collectively reduced the volume of new lawsuits filed in 2024 and 2025, with the Florida Office of Insurance Regulation reporting a steady year-over-year decline in property claim litigation. However, the overall number of open cases remains significant due to older, pre-reform claims still making their way through the courts.

What We’re Seeing in 2025

While the reforms have slowed the flood of new lawsuits, Florida continues to see thousands of active property insurance cases in both state and federal court. Many of these disputes now focus on complex policy interpretation issues rather than AOB-related claims.

Key trends shaping 2025 include:

1. Fewer but More Complex Cases
With AOB claims largely gone, remaining litigation involves larger dollar amounts, disputed policy exclusions, and alleged bad-faith handling. These cases often stem from hurricane or flood damage in coastal counties.

2. Rise in Condominium and HOA Claims
Condominium boards and associations are increasingly litigating coverage disputes over common area repairs, roof replacements, and wind mitigation issues. Associations must now handle these claims directly without assigning them to contractors.

3. Contractor Payment Challenges
Without AOB, contractors now rely on direct contracts with property owners for payment. Disputes over repair quality, scope of work, and unpaid balances are shifting from insurance litigation into civil and construction litigation.

4. Continued Premium Pressures
Although litigation has declined, insurers remain cautious. Reinsurance costs and catastrophic risk continue to keep premiums high, even as legislative reform brings gradual stability.

5. Increased Use of Mediation and Appraisal
With fewer attorney-fee incentives to litigate, both insurers and property owners are turning to alternative dispute resolution methods to settle claims more efficiently.

The Impact of Recent Court Decisions

Several Florida appellate courts have upheld the new AOB restrictions and confirmed the constitutionality of removing one-way attorney fees. These rulings reinforce the state’s push to balance consumer protection with insurer sustainability. At the same time, courts have emphasized that insurers must continue acting in good faith when handling claims—ensuring that policyholders’ rights are not compromised by the shift in incentives.

What Property Owners and Associations Should Do Now

• Review Insurance Policies Carefully – Understand new policy language, including deductible structures, windstorm exclusions, and repair obligations.
• Document Every Claim Thoroughly – Photos, estimates, and correspondence are essential to protecting your position in any dispute.
• Use Licensed Contractors Only – Unlicensed or out-of-state contractors may violate state law and compromise claim validity.
• Engage Legal Counsel Early – For large losses or denied claims, consulting an attorney before taking legal action can help determine whether mediation, appraisal, or litigation is the best path forward.
• Update Governing Documents – Condominium and HOA boards should review bylaws and insurance provisions to ensure compliance with post-reform statutes.

What to Expect Heading Into 2026

Florida’s property insurance litigation volume is expected to continue declining through 2026, but disputes will likely become more specialized. As new insurance companies enter the market, competition may stabilize premiums, while courts continue clarifying the limits of policy exclusions and attorney fee recovery.

The transition period will remain critical. Homeowners, condo boards, and contractors must adapt to a new reality—one where prevention, documentation, and negotiation play a greater role than litigation did in the past decade. For insurers, the reforms are beginning to restore financial viability, but rebuilding trust among policyholders will take time.

Bottom Line

Florida’s property insurance litigation is no longer in crisis, but it is far from quiet. The reforms targeting AOB agreements and attorney fee recovery have reduced volume, yet thousands of cases remain active as older claims wind through the courts. The coming year will test whether these legislative changes can deliver the long-term stability Florida’s property owners and insurers have been seeking for years.

Feinstein Real Estate Litigation & Business Law
501 E Las Olas Blvd, Suite 300, Fort Lauderdale, FL 33301
Phone: (954) 767-9662
Website: www.feinsteinlaw.net

Feinstein Real Estate Litigation & Business Law represents property owners, condominium associations, and developers in insurance coverage disputes, construction defect claims, and complex real estate litigation across South Florida.

Florida’s Commercial Rent Tax Repeal: One Year Later and What’s Ahead for 2026

When Florida officially repealed its commercial rent sales tax in June 2024, it became the only state in the country to eliminate the tax on commercial lease payments. Now, as 2025 draws to a close, the full impact of that change is becoming clear — and it’s reshaping the state’s business and real estate heading into 2026.

The repeal has made Florida more attractive to investors, reduced costs for tenants, and spurred redevelopment in key commercial corridors. But it has also raised new compliance and contract questions for landlords, developers, and brokers navigating the first full year under the new tax-free framework.

A Quick Recap: What Changed

Before the repeal, Florida charged a 5.5% state sales tax on rent for commercial spaces such as offices, retail storefronts, and industrial warehouses. Landlords collected the tax and remitted it to the Florida Department of Revenue, increasing occupancy costs for businesses across the state.

On June 1, 2024, the rate dropped to 0%. That single change eliminated the sales tax burden on all commercial leases — new and existing — and brought Florida in line with every other state that does not tax business rent.

What 2025 Has Revealed So Far

With one full year of data and experience, both the benefits and the complications of the repeal are coming into focus.

1. Leasing Activity Is Surging
Businesses are reinvesting savings from the tax repeal into expansion. Florida’s office and industrial markets have shown measurable leasing growth in 2025, particularly in Broward and Miami-Dade counties. For small and mid-sized tenants, the savings amount to thousands of dollars a year — often enough to fund buildouts or equipment upgrades.

2. Property Values Are Rising
With lower operating costs and stronger tenant demand, commercial properties are becoming more valuable. Appraisers are beginning to adjust capitalization rates to reflect improved net operating income (NOI), giving property owners a measurable boost in asset value.

3. Lease Language Is Creating Legal Issues
Many leases signed before mid-2024 still contain outdated clauses requiring sales tax collection on rent. Some landlords have continued to charge the tax by mistake, while others have faced refund requests from tenants who overpaid. These issues are driving a noticeable increase in lease amendment requests and contract disputes in 2025.

4. Developers Are Gaining Momentum
Lower leasing costs have encouraged developers to move forward with delayed projects. Adaptive reuse and mixed-use developments are particularly active, with investors taking advantage of Florida’s competitive business environment and rising population growth.

5. Brokers Are Using the Repeal as a Selling Point
Real estate professionals are promoting Florida’s “no tax on commercial rent” status as a major advantage for relocating companies. In a national market where operating costs matter more than ever, this remains a persuasive marketing angle heading into 2026.

Key Compliance Steps for Property Owners

Even though the tax is gone, landlords and property managers still have obligations to keep their leases and accounting records compliant.

• Review and update all lease templates to remove any language referencing rent sales tax.
• Audit invoices issued after June 2024 to ensure that no tax was accidentally charged or remitted.
• If tax was collected in error, coordinate with the Florida Department of Revenue to process tenant refunds or credits.
• Adjust property management software to prevent future billing issues.
• Communicate clearly with tenants to confirm that future rent invoices reflect the 0% rate.

Emerging Legal Disputes

Feinstein Real Estate Litigation & Business Law is seeing a growing number of commercial lease disputes tied to the repeal. Common issues include overcollection of rent tax, delayed refunds, miscalculated CAM (common area maintenance) charges, and confusion over “triple-net” lease provisions that still reference sales tax. These disputes will likely continue into 2026 as older leases renew and portfolios are updated.

What to Expect in 2026

As the repeal enters its second full year, the focus will shift from adjustment to optimization. Landlords will continue revising long-term leases and using the savings to reinvest in property improvements. Tenants may see moderate rent increases as landlords capture part of the savings through market adjustments, while developers will likely expand projects that stalled during higher-cost years.

The Florida Department of Revenue is also expected to release further clarification on how the repeal affects subleases, CAM pass-throughs, and mixed-use contracts. Staying informed and working with experienced real estate counsel will remain essential through 2026.

Bottom Line

The repeal of Florida’s commercial rent sales tax is proving to be one of the most impactful business reforms in state history. It’s lowering barriers for companies, attracting new investors, and strengthening the real estate market from Miami to Jacksonville. But it also demands careful attention to contracts, accounting, and compliance — areas where small errors can still lead to major disputes.

With 2026 approaching, property owners, managers, and investors should ensure their documentation is up to date and that their lease terms align with Florida’s new tax-free reality. Doing so now will help avoid costly mistakes later and position their properties for long-term success.

Feinstein Real Estate Litigation & Business Law
501 E Las Olas Blvd, Suite 300, Fort Lauderdale, FL 33301
Phone: (954) 767-9662
Website: www.feinsteinlaw.net

Feinstein Real Estate Litigation & Business Law advises landlords, developers, and commercial tenants throughout South Florida on lease disputes, contract compliance, and real estate development matters.

What the New SIRS Deadlines and Funding Rules Mean for Boards, Owners, and Real Estate Agents

Florida’s condominium laws are once again in the spotlight — and for good reason. The Structural Integrity Reserve Study (SIRS) requirements, milestone inspection rules, and new funding mandates taking effect through late 2025 are reshaping how condominium communities plan, budget, and maintain their properties.

For many condo boards and owners, these reforms are not just about compliance — they’re about financial survival. The new deadlines and funding rules are transforming budgets, testing community relationships, and influencing the entire Florida real estate market.

What Exactly Is the SIRS — and Why It Matters

The Structural Integrity Reserve Study (SIRS) is a comprehensive evaluation of a condominium’s critical structural components, designed to ensure that associations set aside enough money to repair or replace them when needed.

It covers major systems that affect safety and habitability, including:

• Roofs, load-bearing walls, and foundations
• Electrical, plumbing, and fire-protection systems
• Windows, waterproofing, and exterior painting
• Structural floors and mechanical equipment

Every condo association with three or more habitable stories must complete a SIRS and follow its funding recommendations. These studies must be prepared by a licensed engineer or architect and updated regularly.

2025 SIRS Deadlines: The Countdown Is On

By December 31, 2025, most Florida condominiums built before 1992 must complete:

1. Their milestone structural inspection, and
2. Their initial SIRS to determine the required reserves for structural components.

This deadline extension — granted after many associations struggled to meet the previous 2024 timeline — gives boards a small but critical window to complete compliance. However, failing to meet it could expose boards to state enforcement, owner lawsuits, and even insurance complications.

The End of Reserve Waivers

Perhaps the biggest shift in Florida condo law is the elimination of reserve waivers for certain critical items. For decades, associations could vote to “waive” or “partially fund” reserves — often to keep monthly dues low.

That’s no longer an option. Associations must now fully fund reserves for the components listed in the SIRS, including structural and life-safety elements.

This reform aims to prevent catastrophic underfunding — but it’s creating intense financial pressure for many aging communities.

New Funding Mechanisms for Condo Boards

Recognizing these challenges, Florida lawmakers have introduced new tools for associations to manage reserve funding responsibly.

1. Loans and Lines of Credit

Boards may now obtain loans or credit facilities to fund reserves or finance repairs, provided they secure majority approval of the total ownership interests — not just a simple quorum.

2. Phased Reserve Restoration

Associations can plan multi-year reserve restoration strategies, allowing owners to gradually adjust to higher assessments while still moving toward full compliance.

3. Limited Deferral Mechanisms

Under certain conditions, boards can temporarily pause reserve funding if:

• A milestone inspection was completed recently, and
• A current SIRS will be completed before reserve payments resume.

This limited deferral gives financially stressed communities short-term breathing room — but it comes with strict procedural rules and should be used cautiously.

How These Changes Affect Key Stakeholders

Condo Boards

• Administrative Burden: Boards must now coordinate engineers, accountants, and legal advisors to meet all new requirements.
• Financial Planning: Expect sharp increases in assessments as reserves are recalculated.
• Legal Risk: Failing to comply can lead to personal liability claims against board members for breach of fiduciary duty.
• Documentation: Boards should maintain complete records of votes, reserve budgets, inspection contracts, and funding schedules.

Condo Owners

• Higher Costs: Assessments and monthly dues will likely increase as full funding takes effect.
• Transparency Rights: Owners have a legal right to inspect the SIRS, milestone reports, and budgets.
• Protection of Investment: While painful in the short term, proper reserve funding preserves property values and marketability.
• Litigation Awareness: Owners can challenge boards that misuse funds or fail to follow statutory procedures.

Real Estate Agents and Buyers

• Disclosure Requirements: Buyers must now receive clear disclosures about a condominium’s inspection and reserve status before closing.
• Valuation Impact: Properties in compliant, well-funded buildings will command higher values — while those with poor SIRS results or missed deadlines could see devaluation.
• Due Diligence Priority: Real estate agents should encourage clients to review inspection reports and confirm reserve balances early in the purchase process.

Common Legal Disputes Emerging from the New Law

1. Failure to Comply with Deadlines: Boards that miss the 2025 SIRS or milestone inspection deadlines risk lawsuits and insurance cancellations.
2. Disputes Over Reserve Allocations: Owners may challenge how the board calculates or applies reserve funds.
3. Assessment Challenges: Some owners claim new special assessments are improperly adopted or disproportionately allocated.
4. Developer Conflicts: In newer communities, disputes arise over whether developers adequately funded reserves prior to turnover.

These conflicts are expected to dominate Florida’s real estate litigation landscape in 2025 and beyond.

Steps to Stay Compliant and Avoid Litigation

1. Engage Qualified Professionals Early
   Hire licensed engineers and financial consultants who specialize in condominium reserve studies and milestone inspections.
2. Follow Statutory Procedures Exactly
   Every vote, notice, and budget adoption must comply with Florida Statutes Chapters 718 and 719. Procedural mistakes can invalidate board decisions.
3. Educate Unit Owners
   Transparency builds trust and reduces backlash when assessments rise. Regularly publish updates and hold informational meetings.
4. Plan for Financing Options
   Evaluate loan or phased-funding strategies before imposing large one-time assessments.
5. Retain Legal Counsel
   Work with experienced real estate attorneys who understand both the compliance side and the litigation risks under the new SIRS regime.

The Bigger Picture: Stability and Safety

While the 2025 reforms may feel burdensome, they mark an important evolution in protecting Florida’s aging condominium infrastructure. The combination of stricter inspections, realistic reserve funding, and professional oversight will help prevent future tragedies and stabilize property values across the state.

For condo boards and owners, the message is clear: act now, document everything, and seek professional guidance before the deadline passes.

Feinstein Real Estate Litigation & Business Law

Address: 501 E Las Olas Blvd, Suite 300, Fort Lauderdale, FL 33301
Phone: (954) 767-9662
Website: www.feinsteinlaw.net

Feinstein Real Estate Litigation & Business Law represents condominium associations, unit owners, and developers throughout South Florida in complex real estate, construction, and HOA disputes.

Condo Termination & Redevelopment Disputes: What Florida Condo Owners and Boards Need to Know About the New SIRS and Reserve Study Deadlines

Florida’s condominium landscape is shifting once again — and the latest updates to the state’s Structural Integrity Reserve Study (SIRS) and milestone inspection laws are setting off a new wave of redevelopment and termination disputes across South Florida.

For many condo owners and boards, these laws are more than a compliance issue — they’re determining the future of entire communities. Whether you’re an owner, association board member, or developer, understanding how these deadlines and financial requirements impact your rights is crucial.

Understanding the New SIRS and Reserve Study Requirements

The SIRS requirement was originally enacted after the tragic Surfside condo collapse to ensure older buildings remain structurally sound. The law mandates periodic inspections and the creation of reserve studies — financial plans that ensure there are enough funds to repair or replace critical structural components such as:

• Roofs
• Load-bearing walls
• Foundation and floor structures
• Electrical and plumbing systems
• Windows and waterproofing

By late 2025, most Florida condominiums three stories or higher must have completed both their milestone inspection and an updated SIRS report. These studies must then guide the association’s budget for reserves — eliminating the long-standing practice of waiving or underfunding reserves for structural items.

Why These Deadlines Are Fueling Termination and Redevelopment Disputes

For older or financially strained associations, the new rules can create serious challenges. When the cost of bringing a property into compliance exceeds what owners can afford, boards may begin exploring termination or redevelopment as an alternative.

However, these decisions are rarely unanimous — and that’s where litigation is surging.

Common Legal Flashpoints

1. Disagreements Over Property Valuation
When a developer or majority owner pushes for condo termination, minority owners often dispute the valuation of their units. Structural deficiencies revealed in a SIRS can dramatically affect fair market value, leading to legal battles over compensation.

2. Procedural Violations by the Board
The Florida Condominium Act requires strict voting and notice procedures for termination or redevelopment. If a board fails to follow these rules — including obtaining the correct percentage of total ownership votes — any termination agreement can be challenged in court.

3. Alleged Misuse or Deferral of Reserves
Owners may claim that the board mismanaged reserve funds, failed to comply with SIRS requirements, or improperly delayed reserve funding. These condo disputes can turn into breach-of-fiduciary-duty lawsuits against board members.

4. Developer Conflicts and Buyout Tactics
Developers seeking to purchase older buildings for redevelopment are sometimes accused of coercing boards or manipulating valuations to pressure owners into selling. These cases often involve allegations of bad faith, misrepresentation, or conflict of interest.

What Condo Boards Should Be Doing Now

1. Complete Required Inspections Early
Waiting until the last minute increases risk and reduces flexibility. If major structural deficiencies are discovered, boards need time to plan repairs, budget for reserves, or negotiate redevelopment terms.

2. Be Transparent with Owners
Full disclosure of inspection results and funding needs can prevent mistrust and lawsuits. Owners have a legal right to review SIRS reports, budgets, and meeting minutes.

3. Follow the Voting Rules Exactly
Termination or redevelopment cannot proceed without proper notice, quorum, and supermajority approval. Failing to follow statutory voting procedures can invalidate the entire process and expose the board to litigation.

4. Document Every Step
Boards should keep detailed records of inspection reports, financial analyses, legal opinions, and owner communications. If litigation arises, these documents will be key evidence.

5. Seek Independent Professional Advice
Engineering, appraisal, and legal professionals should be independent — not tied to developers or management companies — to ensure objective analysis and protect the board’s credibility.

What Condo Owners Should Watch For

1. Early Warning Signs
If your board begins discussing redevelopment or buyouts without clear disclosure of SIRS results or funding plans, request written copies immediately. Owners have the right to review all official documents related to the decision.

2. Verify the Vote
Ask how the vote for termination or redevelopment was conducted and whether your building met the required supermajority threshold.

3. Challenge Unfair Valuations
If you believe your unit was undervalued, you can challenge the appraisal or file an objection during the termination process. Florida law allows owners to seek judicial review if the process was unfair or deceptive.

4. Understand Your Rights Before Signing Anything
Don’t agree to a developer’s offer or sign a release without consulting an experienced real estate attorney. Once you sign, your ability to contest future actions may be limited.

Litigation Trends in 2025

Attorneys across Florida are seeing an increase in:

• Injunctions to stop premature terminations
• Declaratory actions over defective votes or misleading appraisals
• Breach of fiduciary duty claims against condo boards
• Developer-owner disputes over buyout terms and fair compensation

As the 2025 SIRS deadline approaches, these cases are expected to accelerate, especially in coastal counties like Broward, Palm Beach, and Miami-Dade where aging condominium stock meets skyrocketing redevelopment demand.

Practical Takeaway

The bottom line: condo boards must treat SIRS and reserve compliance as both a safety obligation and a legal one. Cutting corners or rushing into redevelopment without transparency can lead to years of costly litigation.

For condo owners, know your rights — you have the legal ability to challenge unfair terminations, undervalued buyouts, or board mismanagement.

When in doubt, speak with an experienced Florida real estate litigation attorney who understands both the letter of the law and the realities of redevelopment economics.

Feinstein Real Estate Litigation & Business Law

Address: 501 E Las Olas Blvd, Suite 300, Fort Lauderdale, FL 33301
Phone: (954) 767-9662
Website: www.feinsteinlaw.net

Feinstein Real Estate Litigation & Business Law represents condominium associations, unit owners, and developers throughout South Florida in complex real estate and construction disputes.