Consumer eViews

Volume 2, Number 7, February 14, 2005    

In an effort to provide financial relief to storm victims, the Florida Legislature convened in a December special session and approved a law that provided $150 million for those who were charged more than one deductible from multiple storm damage. Additionally, multiple deductibles were eliminated, and a single season deductible is now required for homeowner’s policies.  

As of February 1, 2005, the Florida Department of Financial Services has received 25,000 applications for reimbursement and has disbursed more than $10 million.

This week I am traveling to Washington, D.C., to promote legislation in Congress creating Hurricane Savings Accounts. These accounts will empower Floridians to put money aside to prepare for the financial impact of a major storm.

Structured in the same manner as Health Savings Accounts and IRAs, a hurricane tax-free savings account could be opened to cover current and future hurricane-related expenses. The money deposited, as well as the earnings, would be tax-deferred.  Unused balances would roll over from year-to-year.

The ceiling on the accounts could be twice the amount of the individual’s deductible, and the money could be withdrawn to cover qualified hurricane expenses tax-free. Qualified expenses would include: deductibles, uninsured losses such as docks, pool covers, flood damage, and structural upgrades for future storms.

Hurricane Savings Accounts, which could also be named Catastrophe Savings Accounts for more universal usage, would encourage responsibility by saving for future adverse financial impacts associated with hurricanes or other natural disasters.

Balances would accumulate tax-free, giving consumers the option to purchase higher deductible policies which could result in lower annual premiums, and ensuring that expenditures associated with uninsured losses would be tax-free. The savings accounts would also encourage homeowners to make structural improvements to their homes to be better prepared for a catastrophic event.

As we look to the future, my goal is to help Floridians be prepared structurally and financially.

My best,

                      -- Tom Gallagher



On Feb.2 at the City Place Marriott in West Palm Beach, Alpert Jewish Family & Children’s Service (JFCS) honored Florida’s Chief Financial Officer Tom Gallagher and the WPTV-5 News Team for their efforts during the devastation and continued fallout of Hurricanes Frances and Jeanne.


The 14th Annual Advocate's Award is given by Jewish Family & Children's Service of Palm Beach County to the person who works hard for the most vulnerable in our community. 

Florida's CFO Tom Gallagher won this year's prize because of his strong consumer advocacy, especially in light of the financial pressures from insurance companies, which have only increased due to the recent hurricanes.

The local television station won because of their hurricane coverage when we had two storms in three weeks hit Palm Beach and Martin counties.


CFO Gallagher was presented with the award for his dedication and service, and spoke to the crowd of about 300 people.  

JFCS Executive Director Neil Newstein praised the efforts of the honorees.|

“Tom Gallagher has always been solidly behind consumers and helping them with insurance issues,” Newstein said.  “And while the power lasted, we were all glued to our television sets and the critical, life-saving coverage of the Channel 5 crew.”


Arnold and Marilyn Lampert of Palm Beach Gardens and the South Florida Sun-Sentinel were sponsors of the event.


JFCS is a 30-year-old non-profit, social service agency serving people of all faiths, ages and walks of life. Since 1974, the award-winning agency has helped families of all faiths throughout most of Palm Beach County via counseling, seniors' services, residences for the disabled, mentoring of children, support groups and a lot more. Visit us at


Legislative committees consider two bills that would mandate protocols

State Fire Marshal Tom Gallagher issued a report  that outlines specific requirements and standards that should be in place to protect firefighters during live-fire training exercises. 
The report’s findings come as Florida’s legislative committees consider two bills, one of which the Senate Banking and Insurance Committee took up Wednesday, that would mandate such protocols.
Three Florida firefighters have died in live-fire training exercises since 2002. The State Fire Marshal report being released today stems from an investigation into the 2003 death of a Miami-Dade firefighter in a training exercise in Port Everglades.
“We must do what we can to provide firefighters the hands-on training they need in the safest environment possible,” said Gallagher, who is Florida’s Chief Financial Officer and State Fire Marshal.  “Men and women in this line of duty accept a certain amount of risk, but there are steps that can greatly reduce risk in training exercises.”
Senate Bill 108 is sponsored by Sen. Lee Constantine.  A house companion bill, House Bill 69 by Rep. John Quinones, passed the House Insurance Committee on January 25 and will be heard next by the House Criminal Justice Committee. 
The legislation would give the State Fire Marshal’s Office greater authority to regulate fire department training exercises by adopting National Fire Protection Association standards, as well as provide for regulation of indoor pyrotechnics.
“This legislation stemmed from the senseless tragedy that happened in West Warwick, Rhode Island, in 2003 when countless deaths occurred due to an unlicensed pyrotechnics display.  With this bill, all indoor pyrotechnic shows would now be inspected and permitted by the local Fire Marshal,” Constantine said.  “By also increasing the mandatory level of instructor knowledge of safety and procedures in live-fire training, the bill is protecting the lives of firefighters as well as the rest of the citizens of Florida.”
Quinones agreed, saying, “This is important not only to firefighters but to every citizen who wants a well-trained and well-prepared fire department to respond in their time of need,” said Quinones.  “This legislation not only would protect them during training but also would ensure they learn the right procedures.”
“On behalf of Florida’s firefighters and citizens,” Gallagher said, “I thank Sen. Constantine and Rep. Quinones for pursuing this life-saving legislation.” 
The State Fire Marshal's report is available on-line at


The Florida Office of Insurance Regulation issued a memorandum to insurance companies requesting they delay from filing rate increases until after the Florida legislative session.
“I’m refraining from utilizing the authority vested in the Office of Insurance Regulation by Executive Order 05-13 in anticipation that the industry will cooperate with this voluntary request to delay submitting any rate and/or form filings until after the completion of Florida's legislative session,” said Florida Insurance Commissioner Kevin McCarty.
The Office requests that companies not present any contemplated rates until the regular legislative session concludes in May 2005. Insurers are also asked to place any pending filings in abeyance until this time.
The memorandum is in response to a request for a rate freeze from Florida’s Chief Financial Officer Tom Gallagher at a press conference.


The Florida Office of Insurance Regulation issued a permit to Security First Insurance Company who has applied for a Certificate of Authority to write homeowners policies in the state of Florida.

The permit approval allows Security First to form a company in Ormond Beach, Florida and raise the necessary capital in addition to their $6.3 million capitalization to write future homeowner business.
Florida Insurance Commissioner Kevin McCarty welcomed the new company to the Florida residential insurance market.  “Despite the unprecedented string of catastrophic hurricanes it is reassuring to see not only the commitment to Florida from our present insurance companies, but also the continued interest from new investors, ” McCarty said. “Florida continues to be a good market for future investors.”
As part of their business plan, the company intends to take out policies from Citizens Property Insurance Corporation. Florida policymakers encourage private companies to assume policies from Citizens, Florida’s insurer of last resort.
Security First intends to take out a minimum of 15,000 policies from Citizens in their first year.  Their interest follows the addition of two takeout companies, Gulfstream Property and Casualty Insurance Company and Southern Oak Insurance Company, who in December took out a total of 110,000 policies or 12.5% of Citizens total policies.


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