Plans to shrink the Florida Hurricane Catastrophe Fund, increase the 10 percent
cap on rate hikes for Citizens Property Insurance Corp., create a clearinghouse
for customers to help usher them into the private sector and away from Citizens,
consolidate wind mitigation programs and reduce exposure to coastal homes, and
preventing second homes from going into Citizens were all suggested to the
Lawmakers have been searching for ways to reduce the size of state-run Citizens,
which has 1.3 million policies and is the largest insurer in the state. Citizens
is backed in part by assessments on non-Citizens customers in the event of a
“What I call getting Florida off the drug of artificially low insurance rates,”
Committee Chairman David Simmons, R-Maitland, said.
Simmons said most of the proposals heard Wednesday -- many of which were
proffered by business groups such as Associated Industries of Florida and
the Florida Chamber of Commerce -- will make it into a proposed committee bill
he said should be ready by Feb. 1. If members have issues with some provisions,
they’ll be taken out, he said.
Most members on the panel are in favor of “doing something rather than nothing”
to move more policies into the private market, but many of the proposals have
been suggested before and failed to get through the Legislature in recent years
as individual bills.
Other proposals, however, are fairly fresh. Insurance Consumer Advocate Robin
Westcott suggested consolidating Citizens’ wind mitigation programs in the
Department of Emergency Management, and said about 70 percent of policies
in Citizens’ coastal account have no wind mitigation devices at all, which could
reduce the state’s overall risk.
Sen. Jeff Brandes, R-Tampa, suggested letting private companies share the risk
of individual policies. Under the proposal, private companies would take on a
portion of the risk of a Citizens policy while taking on the responsibility of
administering the policy.
Despite the historic property insurance divide in Florida pitting coastal
lawmakers versus inland and North Florida lawmakers, Simmons said his bill will
be able to steer clear of political pitfalls.
“We’re not going to engage in it. We’re not going to need to. We’re going to
provide an alternative, a sound alternative, to the coastal policyholders and
therefore the policymakers -- and I’m talking about the leg who rep those areas
-- that we’re going to provide a palatable alternative to them so that they can
look at this and say ‘You know what? I’m not going to be hurting my own
constituents,’” Simmons said.