As such, it is important that the CAT Fund can pay its claims when the big storm
comes, which it surely will. The House district I represent is a coastal
district that is very susceptible to hurricane and tropical storm-related
damage, and it is important that the CAT Fund can pay its claims. If it fails to
do so, your insurance company in turn will not be able to pay your homeowner’s
claim after the storm. HB 1107 will stabilize the CAT Fund so that it can pay
these claims when they arise.
The CAT Fund was created in 1993 after Hurricane Andrew, to help insurers pay
homeowner’s claims if a major storm causes widespread damage. Because Florida is
considered the world’s highest-risk land mass for hurricanes, a financially
dependable CAT Fund is critical.
The CAT Fund itself estimates that it would not have been able to pay its claims
to their homeowner’s insurance companies in four of the past several years
(2007, 2008, 2011 and 2012.) That’s more than 50 percent of the time, and that
puts Florida at risk for financial disaster.
This is exactly why we need to right-size the CAT Fund.
In order to do this, the maximum obligations of the CAT Fund needs to be reduced
from the current $17 billion to $14 billion, and this bill does just that. David
Hart of the Florida Chamber of Commerce told the Government Operations
Subcommittee last week that its vote on the bill would “be the most responsible
votes you’ll take this session.”
So far, this bill has seen bipartisan and overwhelming support from my
colleagues in the House. This is because research shows that right-sizing the
CAT Fund can be done with negligible impact on rates. Florida’s insurance
consumer advocate, Robin Westcott, has so testified in committee meetings.
I will present this bill to the House Regulatory Affairs Committee today, and
Sen. Alan Hays, R-Umatilla, will present the Senate companion bill to the
Insurance and Banking Senate Committee.
Together we’re working to bring this good legislation to the full Legislature
for a vote to lessen the risk to Floridians.
The 2013 hurricane season begins very soon. Floridians should not be forced to
rely on good luck to keep them safe from a financial catastrophe.
If action is not taken, the CAT Fund shortfall has the potential to lead to
financial disaster. My objective as an elected official is to correct a
situation that has begged for a solution for many years.
I want your homeowner’s claim to be paid when the inevitable storm comes.