Florida Insurance Consumer Advocate Sean Shaw has released aneditorial calling on lawmakers to reject the "Consumer Choice" billwhen they meet for the 2010 legislative session.

Sen. Mike Bennett and Rep. Bill Proctor have offered Senate Bill876 and House Bill 447 in their respective chambers. Thelegislation, widely referred to as the "Consumer Choice" bill,would allow insurers to raise rates without state approval. Theproposal has been endorsed by a number of groups.

The full text of the media release appears below.

For Immediate Release PropertyInsurance Deregulation: A choice too costly forconsumers By: Sean M. Shaw Esq., Florida InsuranceConsumer Advocate Brad Ashwell, Florida Public Interest ResearchGroup, Democracy & Consumer Advocate Bill Newton, FloridaConsumer Action Network, Executive Director Date: January 22, 2010This has been a tough year for property insurance consumers in theState of Florida. 2009 brought Floridians problems from harmfulChinese Drywall to the threatened exit of State Farm. Now, two ofFlorida's legislators, Senator Mike Bennett and Representative BillProctor, have proposed a bill to deregulate residential propertyinsurance rates. Senate Bill 876 and House Bill 447 claim to giveconsumers "greater choice" by allowing property insurance companiesto charge unregulated rates to their residential customers. Theproposed legislation also stipulates that no private insurer can becharged an assessment until of all Citizens' policyholders havebeen charged a 15% assessment. While these provisions are similarto the "consumer choice" bill introduced in the 2009 legislativesession, unlike the previous bill, this legislation would allowall authorized property insurers in thestate to charge any rate, not just a select few. CitizenOverload Senator Bennett has stated that he filed thisbill in response the perception that Citizens' legislatively setrates are driving private property insurers from Florida.Unfortunately, this bill does nothing to address Citizens' rates,either through deregulation of Citizens or through any othermechanism. Allowing property insurers to charge unregulated rateswould only serve to increase the divide between Citizens' rates andwhat other companies can charge. If Senator Bennett andRepresentative Proctor are truly concerned about Citizens' rates,it would make more sense for their legislation to directly addresstheir concerns. Does Deregulation Work Proponentsof deregulation claim that deregulation will bring new insurers tothe market. However, no insurer has said publicly that they wouldenter Florida if the property insurance market was deregulated.Deregulation also strips out a huge layer of consumer protectionfor all Floridians. Because the average consumer does not have theresources or information to determine when a rate is excessive, theopportunity for the company to abuse consumers exists. However, theState of Florida has the time, knowledge, and resources to judgethe fairness of rates contained in insurance policies. The statecan provide a warranty of fairness to the insurance consumers ofFlorida. Our View The sponsors of this legislationmistakenly call this bill the "Consumer Choice" insurance bill.However, the only choice that consumers are given is between higherpremiums (based on recent rate filing requests anywhere for 25% to50%) or a move to Citizens' property insurance. However, this billdoes not accomplish any improvement – instead it wouldsignificantly hurt Florida's consumers. Deregulation of ourproperty insurance industry rates would allow insurance companiesto abuse consumers through excessive rate increases and would hurtFlorida financially by overburdening Citizens. We also do not seeany hard evidence this bill can achieve its stated goal ofattracting new companies to the state. We call on members of theFlorida Legislature to vote against the proposed deregulation bill.If this legislation should pass, we urge Governor Crist to againveto this type of proposal. We encourage the legislature to choosewhat's in the best interest of the citizens of Florida. [endrelease]