They prowl Florida car parks and car washes looking for cars with damaged windscreens, often carrying gifts; gift cards, steak dinners and discounted hot tubs are common.
Insurance companies call them “harvesters”, and their sales pitch to car owners is simple: Auto glass shops can offer free windscreen replacements because it’s covered by your comprehensive insurance. All they need is a signature.
But after the signature is collected and the repair is made, the glass shops send exorbitant bills to the insurers, who often deny the claim or pay a lesser amount. Lawyers then sue the insurance company for payment and legal fees, often settling hundreds of claims at a time for a hefty sum.
It’s all part of a network of out-of-state companies and lawyers who have created an entire industry based on these glass replacements – so costly to insurance companies that it has caused rates to skyrocket across the state, consumer advocates say.
The tactic is common only in Florida, where more than 46,000 auto glass lawsuits have been filed so far in 2023, according to the state’s Department of Financial Services.
Consumer protection laws have fueled the trend, which has exploded in recent years – just 591 such lawsuits were filed in Florida in 2011. Advocacy groups point to the burgeoning industry of “unscrupulous” auto glass shops and lawyers as a major factor in the state’s high insurance costs.
The lawsuits have inflamed an 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 bad that lawmakers passed two laws last year to try to slow it down.
While auto insurance rates are rising faster than inflation nationally, Florida’s increases have been the most drastic – the average premium today is 88 percent more expensive than it was a decade ago, according to figures from industry data firm Insure. Insurers have blamed the high premiums on hurricanes and a high percentage of uninsured drivers, but companies rarely mention that they are also passing on the costs of auto glass lawsuits.
When Florida resident Francinete Borgstrom was approached by an auto glass salesman in an Orlando parking lot last December, the offer “didn’t set off any alarms,” she said. The salesman 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 realise that when she signed her assignment of benefits – authorising the glass repair company to take over her rights under her insurance policy to seek payment for the work – she also gave the company the right to sue the insurer on her behalf if necessary. Auto Glass America did just that when the insurance company, AssuranceAmerica, refused to pay the $1,461 bill. This price is more than four times the average cost of this type of repair, according to figures cited in a lawsuit filed by another insurance company, Allstate, against the same shop.
These glass shops primarily target the elderly, immigrants and non-native English speakers, consumer advocates said and court records show. Borgstrom, who immigrated to the United States from Brazil, was unaware a lawsuit had been filed in her name 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 service. The other glass repair shops mentioned in this article did not respond to requests for comment.
“Not only will it most likely result in a higher rate at the next renewal date, but it has the potential to generate a non-renewal at the end of the current policy period,” said Mark Friedlander, director of communications for the Insurance Information Institute. “The average $30 repair can have a six-figure impact on an auto insurance company.”
Gift cards and steak dinners
The auto glass shops hire recruiters to find customers, sometimes even going door-to-door, insurance company lawsuits allege. Along with a free glass replacement, the harvesters sometimes offer gifts to entice their targets, some worth as much as $200.
Once a glass company persuades a driver to agree to the replacement and sign an assignment of benefits, the shop adds “unreasonable fees and tack-ons” to the insurance claim, said Michael Carlson, president of the Personal Insurance Federation of Florida, an industry trade group.
When insurance companies pay less for the replacement or deny the claim altogether, the glass shops sue for the rest of the reward. Then come the lawyers.
Until recent changes passed by the state legislature, Florida had what is known as “unilateral attorneys’ fees” – a requirement that the insurer pay the plaintiff’s reasonable attorneys’ fees if it loses or settles a claim. These legal fees are “where the real gravy is,” 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 lawyers file 96 per cent of glass lawsuits in Florida, according to data commissioned by the Florida Justice Reform Institute.
The lawyers who file the lawsuits argue that they’re helping individuals fight a large, entrenched system.
“The idea was to balance the scales of power between a billion-dollar insurance company and Mom and Joe,” said William England, an attorney with Chad Barr Law who specialises in auto glass litigation. “When it comes to abuse, there’s always a few bad apples in any society.”
Initial claims are typically just a few pages long and based on a template that can be filled in with the insured driver’s name and the date of repair, a streamlined process that helps auto glass lawyers quickly file thousands of cases with relative ease.
Lawyers will offer to settle bundles of claims for a single sum, Carlson said. That’s cheaper for insurers than litigating each case individually, even if some are winnable, because insurers can pass the cost of the settlement on to policyholders, Friedlander said.
But insurance companies would rather not have to deal with mass torts at all. In a lawsuit filed by Allstate against Auto Glass America in 2019, the insurance giant called the practice a “greedy scheme to extract as much money as possible”. The combined cost of Auto Glass America’s claims and litigation against Allstate in 2017 and 2018 exceeded $600,000, according to the lawsuit. “The impact of AGA’s wrongful and inequitable conduct is substantial,” it added.
Jannet Mehmed, 76, had the glass on her 2017 Toyota Camry replaced by Orange Blossom Auto Glass after finding the company through an online search in August 2022. Mehmed’s State Farm agent later called her with bad news – she had been charged $1,812, well above market rate.
“Seniors are very trusting,” Mehmed said. “You give them the impression that you’re going to help them, and they open their checkbooks.”
Some insurance company lawsuits allege that harvesters forged the signatures of drivers who declined their offers. Others allege that after collecting the signatures, the glass shops never made the repairs, but filed claims anyway.
Fixing the cracks
For years, the practice of filing auto glass lawsuits existed within the bounds of the law, thanks to one-way legal fees and lax insurance regulations. When the number of lawsuits spiked in 2019, a coalition of insurance groups called for changes to the state’s laws through an initiative called Fix the Cracks.
The initiative, led by the Personal Insurance Federation of Florida and funded through trade associations of Allstate, Farmers Insurance, Progressive and State Farm, helped pass two laws aimed at shutting down Florida’s freewheeling auto glass industry and putting an end to “windshield bullies,” according to its website.
The first, passed in December 2022, banned unilateral legal fees for insurance-related claims. The second, passed in May, banned assignment of benefits for auto glass repairs, making it harder for glass replacement companies to repair windshields without first contacting insurance companies. The May law also makes it illegal for glass companies to offer free benefits in exchange for services.
But auto glass lawsuits are still being filed, court records show. The assignment-of-benefits law applies only to insurance policies renewed or reissued after May 26, 2023, Kalifeh said, giving lawyers a six- to 12-month window to file as many lawsuits as possible before all existing policies are renewed – 46,059 lawsuits were filed from January to August, according to data commissioned by the Florida Justice Reform Institute.
Some plaintiffs’ lawyers argue that insurance companies are still benefiting from the changes in Florida law. Imran Malik, a lawyer who filed more than 7,000 glass lawsuits in 2022, said insurers have used litigation costs as a “convenient scapegoat” to raise rates, but have yet to lower them since the new laws were passed.
“Despite all the changes in the law, not a single insurance company has lowered its rates at all,” Malik said.
Insurance companies, Malik added, have long had “cozy relationships” with larger glass shops such as Safelite, which take business away from smaller glass shops. Safelite did not directly 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 cases since 2019. “The problem is, plaintiffs’ attorneys will abuse the system if you let them. Insurance companies will abuse the system if you let them. … The insurance companies got exactly what they wanted – they got rid of everything – and the rates are still going up.”
Hicks added that he himself was recently dropped by Geico for not having minimum liability auto insurance, even though he pays for a Geico umbrella policy.
The total cost of claims made by glass shops and their legal costs is unknown, but Kalifeh estimates it to be “easily in the tens of millions of dollars a year”.
England and Hicks, however, believe that the new laws will effectively end auto glass litigation as an industry once the grace period for filing claims expires. When that happens, it is unclear how much insurers will reduce premiums. State Farm, Allstate and Progressive declined to comment on the impact of the lawsuits on individual rates.
