Comment on this storyCommentAdd to your saved storiesSave
They scour parking lots and car washes in Florida looking for cars with damaged windshields, often with gifts; Gift cards, steak dinners and discounted hot tubs are the most common offers.
Insurance companies call them “harvesters,” and their selling point to car owners is simple: Auto glass shops can offer free windshield replacement because it’s covered by comprehensive insurance. All they need is a signature.
But after the signature is collected and the repairs are made, glass shops send inflated bills to insurers, who often deny the claim or pay out a lesser amount. Lawyers then sue the insurance company for payment and legal fees, often settling hundreds of lawsuits at once for a large sum.
It’s all part of a network of out-of-state companies and lawyers that have built an entire industry based on these glass replacement products — which are so costly to insurance companies that rates have skyrocketed nationwide, consumer advocates say.
This tactic is unique to Florida, where more than 46,000 auto glass lawsuits have been filed so far in 2023, according to the state’s Department of Revenue.
Consumer protection laws have fueled this trend, which has exploded in recent years—only 591 such lawsuits were filed in Florida in 2011. Advocacy groups point to the emerging industry of “unscrupulous” auto glass repair shops and lawyers as a major factor in the state’s high insurance costs.
The lawsuits have further fueled the already bleak auto insurance market in Florida – a state whose average auto insurance premium of $2,560 is the highest in the country. The problem of auto glass litigation has become so serious that lawmakers passed two laws last year to slow it down.
While car insurance premiums are rising faster than inflation nationwide, the increases have been most dramatic in Florida – the average premium is 88 percent more expensive today than it was a decade ago, according to figures from industry data firm Insure. Insurers blame hurricanes and a high proportion of uninsured drivers for the high premiums, but the companies rarely mention that they also pass on the costs of auto glass litigation.
When Florida resident Francinete Borgstrom was approached by an auto glass salesman in an Orlando parking lot last December, the offer “didn’t raise any alarms,” she said. The salesperson told her that Auto Glass America could replace her broken windshield with no deductible, so she signed the waiver with no questions asked.
Borgstrom said she didn’t know that when she signed her assignment of performance, she also gave the business the right to sue for performance – that is, she authorized the glass repair company to assume her rights under her insurance policy and payment for the work to request the insurer on your behalf if necessary. Auto Glass America did just that when the insurance company, AssuranceAmerica, refused to pay the $1,461 bill. That price is more than four times the average cost of this type of repair, based on figures cited in a lawsuit filed by another insurance company, Allstate, against the same repair shop.
These glass shops primarily target the elderly, immigrants and non-native English speakers, consumer advocates say and court filings suggest. Borgstrom, who immigrated to the United States from Brazil, was unaware that a lawsuit had been filed on her behalf until she was contacted for this article.
A representative for Auto Glass America declined to comment on its business model but said the company no longer offers gifts in exchange for services. The other glass repair shops mentioned in this article did not respond to requests for comment.
“Not only will this most likely result in a higher rate at their next renewal date, but there is also the potential for them not to renew at the end of their current policy term,” said Mark Friedlander, communications director for the Insurance Information Institute. “The average $30 repair could mean a six-figure loss on auto insurance.”
Gift cards and steak dinners
The auto glass repair shops hire harvest workers to find customers, sometimes even going door-to-door, insurance company lawsuits say. In addition to a free replacement glass, harvesters sometimes offer gifts to entice their targets, some of which can be worth up to $200.
As soon as a glass company convinces you If the driver agrees to the replacement and signs assignment of benefits, the deal adds “unreasonable fees and add-ons” to the insurance claim, said Michael Carlson, president of the Personal Insurance Federation of Florida, an industry group.
If the insurance companies pay a lower amount for replacement or reject the claim entirely, the glass companies sue for the remainder of the premium. Then the lawyers come.
Until recent changes passed by the state legislature, Florida had so-called “disposable attorney fees” – a requirement that the insurer pay the plaintiff’s reasonable attorney fees if they lose or settle a claim. Those litigation fees are “the real problem,” said Ashley Kalifeh, a partner at Capital City Consulting, which worked with Florida regulators to close loopholes in the state’s insurance laws.
These fees are concentrated in a small group: Just 20 attorneys file 96 percent of Florida’s glass lawsuits, according to the Florida Justice Reform Institute.
Lawyers filing the lawsuits argue that they help individuals fight a large, entrenched system.
“The idea was to balance the power balance between a billion-dollar insurance carrier and Mom and Joe,” said William England, an attorney at Chad Barr Law who specializes in auto glass litigation. “When it comes to abuse, there are always a few bad apples in any society.”
Initial lawsuit filings are typically only a few pages long and are based on a template that can be filled out with the name of the insured driver and the date of the repair. This is a streamlined process that helps auto glass lawyers file thousands of cases quickly and with relative ease.
Lawyers would offer to settle a series of lawsuits for a single sum, Carlson said. This is cheaper for the insurers than litigating each case individually, even if some of them can be won because the insurance companies can pass on the costs of settlement to the policyholders, said Friedlander.
But the insurance companies would rather not have to deal with mass lawsuits in the first place. In a lawsuit Allstate filed against Auto Glass America in 2019, the insurance giant called the practice a “greedy scheme to extract as much money as possible.” The total cost of Auto Glass America’s claims and litigation against Allstate in 2017 and 2018 was over $600,000, according to the lawsuit. “The impact of the AGA’s unlawful and unfair conduct is significant,” she added.
Jannet Mehmed, 76, had the glass on her 2017 Toyota Camry replaced with Orange Blossom Auto Glass after finding the company through an online search in August 2022. Later, Mehmed’s State Farm agent called her with bad news – she had been charged $1,812, far more than the listing price.
“Seniors are very trusting,” Mehmed said. “You give them the impression that you’re going to help them, and they’re going to open their checkbooks.”
Some insurance company lawsuits allege that harvesters forged the signatures of drivers who rejected their offers. Others claim that the glass shops never made the repairs after collecting the signatures, but still filed claims.
For years, the practice of filing auto glass lawsuits has stayed within legal limits thanks to one-sided legal fees and loose insurance regulations. As the lawsuits reached their peak in 2019, a coalition of insurance groups called for changes to the state’s laws as part of an initiative called “Fix the Cracks.”
The initiative, led by the Personal Insurance Federation of Florida and funded by trade associations of Allstate, Farmers Insurance, Progressive and State Farm, helped pass two laws aimed at shutting down Florida’s permissive auto glass industry and curbing the “windshield tyrant.” to put an end to it. according to its website.
The first measure, passed in December 2022, excluded one-time payment of attorney fees for insurance-related claims. The second law, passed in May, banned the transfer of assignment of benefits for auto glass repairs and made it more difficult for glass replacement companies to repair windshields without first contacting insurance companies. The May law also prohibits glass companies from offering free perks in exchange for services.
However, court records show that car glass lawsuits continue to arise. The assignment of benefits law only applies to insurance policies renewed or reissued after May 26, 2023, Kalifeh said, leaving lawyers six to 12 months to file as many lawsuits as possible before all Existing policies were renewed – According to the Florida Justice Reform Institute, 46,059 lawsuits were filed from January to August.
Some plaintiffs’ lawyers argue that insurance companies could continue to benefit from Florida’s law changes. Imran Malik, a lawyer who filed over 7,000 glass lawsuits in 2022, said insurers had used litigation costs as a “convenient scapegoat” to raise rates but had not yet lowered them since the new laws were passed.
“Despite all the changes in the law, not a single insurance company has lowered their rates at all,” Malik said.
Malik added that insurance companies have long had “pleasant relationships” with larger glass shops like Safelite, from which smaller glass shops lose business. Safelite did not immediately respond to emailed questions about its relationship with insurance companies.
“There aren’t a lot of clean hands in this industry,” said Florida attorney Zachary Hicks, who has been working on auto glass litigation since 2019. “The problem is that plaintiffs’ lawyers will abuse the system if you let them.” Insurance companies will abuse the system if you let them. … Insurance companies got exactly what they wanted – they got rid of everything – and the rates are still high.”
Hicks added that he himself was recently fired from Geico for not having minimum automobile liability insurance, even though he pays for a Geico master policy.
The total cost of claims brought by glass workshops and the cost of litigation is unknown, but Kalifeh estimates it is “easily in the tens of millions of dollars per year.”
However, England and Hicks believe the new laws will effectively end auto glass litigation as an industry once the grace period for filing lawsuits expires. If this is the case, it is unclear how much insurers will reduce premiums. State Farm, Allstate and Progressive declined to comment on how the lawsuits affect individual rates.