Volume 2 Number 45 November 7, 2005

After suffering eight devastating hurricanes in 15 months, it is clear that we have to take action to protect the way of life we have come to love here in Florida.    Brian Tracy, who has published nearly two dozen books on the development of human potential, says:  “Resolve to be a master of change rather than a victim of change.”  As part of a multi-faceted package to address insurance issues, I am advocating both federal and state solutions.  At the federal level, I'm urging Congress to create a national catastrophe fund – something I lobbied for following Hurricane Andrew in 1992.  I am also urging Congress to set up Catastrophic Savings Accounts to allow homeowners to save tax-free for deductible and storm recovery costs and insurers to accumulate tax-deferred catastrophic reserves.  On the state level, I am asking the Legislature to use sales tax revenue collected from hurricane recovery to help offset assessments against homeowners and encourage Floridians to strengthen their homes.  I am also calling for the standardization of Florida’s building code and capping coverage on homes valued at $1 million or less in Citizens Property Insurance Corporation, the state’s insurer of last resort.  If we act now, we can make sure that property insurance remains available and affordable for citizens.  If we act now, we can better prepare for future storms.

PRESSURE ON FLORIDA'S INSURANCE MARKET CFO GALLAGHER'S PROPOSALS

GALLAGHER OFFERS COMPREHENSIVE SOLUTIONS TO BETTER PROTECT HOMEOWNERS AND STRENGTHEN PROPERTY INSURANCE MARKET Tom Gallagher, Florida’s chief financial officer, outlined several proposals for strengthening Florida’s property insurance market and better protecting homeowners and condominium unit owners from financial devastation after a hurricane strikes.  Gallagher also gave his support for federal solutions being advocated by Governor Jeb Bush and key congressional leaders. “Eight catastrophic storms in 15 months have caused more than $32 billion in insured damages, and Florida homeowners will bear the brunt of this burden if we don’t act now to implement solutions to prevent an insurance market meltdown,” said Gallagher, whose office has received nearly 600,000 phone calls from storm victims in the last year.  “It will take a comprehensive approach to tackle the challenges that we face as a state.” As part of a multi-faceted package to address insurance issues, Gallagher advocated both federal and state solutions.  At the federal level, Gallagher is urging Congress to establish a national catastrophe fund, for which he lobbied following Hurricane Andrew in 1992, and to create individual Catastrophic Savings Accounts (CSAs) to allow homeowners to save tax-free for deductible and storm recovery costs.  He is also recommending Congress pass U.S. Representative Mark Foley’s legislation to allow the accumulation of tax-deferred catastrophic reserves by insurers. CONTINUED

GALLAGHER DEPLOYS MOBILE ASSISTANCE UNIT TO HIALEAH FOR FLORIDIANS IMPACTED BY WILMA Tom Gallagher, Florida’s chief financial officer, announced that he has deployed a second mobile assistance unit to South Florida to help hurricane victims in the recovery process.   Gallagher, who was on-hand at the opening of the new unit in Hialeah, was joined by State Representative Ralph Arza, Hialeah City Council President Julio Robaina and Miami-Dade School Board Chair Frank Bolaños.  “So many Floridians were impacted because of the wide path of destruction caused by Wilma, and we are here to help,” said Gallagher.  “My goal is to make sure no one takes advantage of storm victims and that insurance claims are paid quickly.” The new location is in Hialeah at Amelia Earhart Park, 401 East 65th Street at the intersection of 122nd Street. The mobile units are staffed with the Department of Financial Services’ consumer specialists who can help affected Floridians reach their insurance companies, start the claims process, and understand what steps they should take to rebuild.   CONTINUED

NEW SINGLE HURRICANE DEDUCTIBLE LAW MAY ASSIST VICTIMS OF MULTIPLE HURRICANES THIS SEASON  Tom Gallagher, Florida’s chief financial officer, alerted storm victims that damage sustained from multiple hurricanes this season can be combined to meet a single windstorm insurance deductible.  “Following the unprecedented four hurricanes we were hit with in 2004, we were successful in passing a law to limit hurricane deductibles to one per hurricane season,” said Gallagher, “regardless of the number of hurricanes that affect the policyholder.  Floridians need to know that losses suffered in separate storms can be combined to reach the deductible amount.  My hope is that this new law will protect people from financial devastation.”  Under the new law, one full hurricane deductible, typically two or five percent of the total coverage for the structure, can be applied, regardless of the number of storms. However, once the full hurricane deductible has been met, insurers can only apply a non-hurricane deductible on future claims from other storms. The usual non-hurricane deductible for losses that result from other causes, such as fire or theft, is $500.  CONTINUED