The report pointed to parts of the new law designed to curb litigation, which insurers have long blamed for driving up costs. But it also cited underlying issues in the system, such as national insurance companies being leery of doing business in the state and Florida carriers being heavily dependent on reinsurance.

Reinsurance, which is critical backup coverage, has become more expensive and difficult for Florida insurers to buy — with costs passed along to homeowners. The law approved during a special session last week included steps such as providing $1 billion for a temporary program to help insurers get reinsurance coverage.

The law, which Gov. Ron DeSantis quickly signed, made a series of changes to try to reduce litigation costs. Those changes included eliminating what are known as "one-way attorney fees," which have required insurers to pay the attorney fees of policyholders who successfully file lawsuits.

Also, the law eliminated the long-controversial practice of assignment of benefits for property-insurance claims. Assignment of benefits involves policyholders signing over claims to contractors, who then pursue payment from insurers. Insurers contend the practice has led to increased lawsuits.

The AM Best report said that if "these measures prove effective, they could significantly lower insurers' defense and cost containment expenses." It also said the changes "will bring about much needed relief, but such relief is unlikely to be immediate."

Among other things, the report said the law is likely to draw court challenges.

Insurers have dropped hundreds of thousands of policies and sought large rate increases because of financial losses. At the same time, the state-backed Citizens Property Insurance Corp., which was created as an insurer of last resort, has seen its number of policies more than double to 1.14 million.

During last week's session, lawmakers passed a 105-page bill that deals with numerous issues, including trying to push policies out of Citizens into the private market. It will prevent Citizens policyholders from being able to renew coverage if they receive policy offers from private insurers that are within 20 percent of the cost of the Citizens premiums.

But the measure drew opposition from Democrats and groups such as plaintiffs' attorneys. They said it will not lead, at least immediately, to lower rates for homeowners and will hamper the ability of property owners to fight insurers in claims disputes.

Republican supporters, however, said it was designed to stabilize rates and bring more insurers to Florida.

The AM Best report is titled, "Florida Insurance Reforms: Long-Term Relief on Horizon; Near-Term Headwinds Remain." It pointed to remaining questions about how the changes will affect reinsurance and said "weather loss via hurricanes remains an important factor to take into account when conducting business in the state."

"Legislators have taken aim at elements influencing rising reinsurance costs, but how material the potential savings for insurers will be under the new legislation will depend on whether the private reinsurance market interprets the most recent actions as viable mitigations since the risk of catastrophe losses remain," Chris Draghi, an AM Best associate director, said in a prepared statement.