If Florida insureds and insurers haven’t been pummeled enough by rising costs in recent years, they could soon see another factor that could hit them in the pocketbook.

Florida’s tough new immigration law that took effect July 1, requiring more verification and documentation by employers and hospitals, reportedly is scaring away thousands of immigrant workers–the bulk of the labor force that has become the norm when Floridians rebuild after a hurricane. The labor shortage could raise construction costs significantly, leading to higher expenses for insurers and higher premiums, larger deductibles and less coverage for some property owners.

“The roofing industry is having trouble find workers, yes. The law is having an effect on our ability to man jobs,” said Mike Silvers, director of technical services for the Florida Roofing and Sheet Metal Contractors Association.

One of the top risk and insurance economists in the U.S. said the law, championed by Florida Gov. Ron DeSantis, is bad policy and will cost insureds and insurers dearly.


“Choking off the supply of skilled, experienced immigrant labor is not only counterproductive from an economic perspective – it may also increase property claims severities,” said Robert Hartwig, clinical associate professor of finance at the University of South Carolina.

Without enough skilled workers, some storm-damaged properties will have to wait to be repaired, setting off a cascade of loss-adjustment and other expenses.

“The longer properties remain exposed to the elements the more they’re likely to deteriorate,” Hartwig, director of USC’s Center for Risk and Uncertainty Management, told Insurance Journal. “Insurers will also have to pay more for temporary living expenses because repairs may take longer.”

Longer repair times also could mean more litigation, including bad-faith claims against insurers, which could give new fuel to plaintiffs attorneys – the group that the insurance industry has blamed for back-breaking litigation costs in the last several years.

“It is supremely ironic that Florida would seek to arrest and prosecute hard-working disaster recovery laborers whose efforts actually provide significant economic benefit to the state and its residents, while leaving the doors wide open to trial lawyers who last year brought the Florida homeowners insurance market to the brink of collapse,” Hartwig added.

The Miami Herald reported on the law and the impending labor shortage earlier this week. Resilience Force, a labor group that advocates for disaster workers, told the Herald that its recent survey of 2,000 workers found that more than half said they don’t want to come to Florida, due to the new law. Many said they feared deportation, harassment and arrest.

The law, Senate Bill 1718, approved in May, requires private employers with 25 or more employees to use the federal E-Verify system to check the immigration status of new workers. The law also beefs up penalties for those who avoid using the system and who hire unauthorized immigrants; it forces hospitals to ask patients about immigration status; and makes it a felony to drive an undocumented person into Florida, among other restrictions.

Some Florida construction companies have long been known to hire undocumented workers, and many businesses in the state have looked the other way, especially after a hurricane. Even the U.S. Customs and immigration enforcement agencies have adopted a policy of backing off enforcement actions in disaster zones, the Herald has reported.

It’s an open secret in Florida and other parts of the country that a large number of undocumented but often highly experienced workers move from place to place providing rebuilding services, despite the politics of immigration regulation, construction groups and immigration advocates have said.


“As climate disasters have become more and more destructive, a workforce has come together that rebuilds after hurricanes, floods and fires,” Saket Soni, of the Resilience Force group, notes in the group’s YouTube video posted early this year. “When they roll into town, everybody breathes a sigh of relief and recovery starts in earnest.”

Much of the labor in construction comes through subcontractors, who often contract with other subcontractors or labor suppliers that have a history of skirting immigration laws, or have found ways to cheat the immigration verification system, Silvers said. Silvers, with the Roofing and Sheetmetal Association, said his members have been told that state authorities may not vigorously enforce the new law. But they fear that could lead to confusion and selective enforcement, he noted.

“Our members want to hire people legally,” but that can be difficult when others supply the workers, Silvers said.

Regardless of enforcement, many migrant workers apparently aren’t taking their chances in Florida this year. And that could prove to be a big problem in a state prone to storms. The immigrant workforce has become crucial to recovery efforts, which often involve hot, dirty, dangerous work, Hartwig said.

“It’s clear that with a 2.7% unemployment rate in the Sunshine State, there are few Floridians willing and able to leave their current jobs to toil amid the muck and debris,” Hartwig said in an email. “This is why the itinerant disaster recovery labor force is so critical to assure a speedy recovery—in Florida and wherever disaster strikes.”

He put the Florida immigrant labor law into perspective by comparing it to blocking or placing tariffs on building materials simply because they are made in a non-English speaking country. Florida residents would be screaming if they were unable to get the materials and repairs they need, he argued.

“All the insurance money and federal aid in the world will be of no use unless it can be transformed by skilled laborers—many of them immigrants—into installed walls, electrical wiring, roofs, windows, plumbing, appliances, carpets and everything else it takes to rebuild homes and businesses,” he said.

DeSantis as Hurricane Ian approached Florida last year. (Tallahassee Democrat via AP)

It’s not certain at this point how much a labor shortage might add to the cost of rebuilding after Hurricane Idalia, which hit part of Florida Aug. 30, and after Ian, which slammed the state a year ago. But Liberty Mutual Insurance put out a bulletin this year that said labor is a significant factor in rising U.S. premiums, and the construction industry is already short by about 200,000 skilled workers.

Hartwig suggested that Florida should chuck the current law and instead develop an expedited waiver process that would allow needed workers into the state without fear of arrest or deportation.

DeSantis has been criticized by opponents for not taking quick enough action to stem Florida’s property insurance crisis and rising premiums, but lauded by others for helping to craft a legislative package last year that is designed to stem excessive claims litigation. His office could not be reached for comment Wednesday for this article.

Top photo: Workers remove large oak tree branches that fell on an Orlando home in Hurricane Ian, in 2022. (Phelan M. Ebenhack via AP)

This article was originally published on Insurance Journal. Reporter Will Rabb is the Southeast editor of Insurance Journal.