For the third year in a row, Florida lawmakers have unveiled a major property insurance bill. The 2011 bill proposes sweeping changes to everything from sinkhole coverage to how much policyholders could get paid after damages to their home.
Two previous efforts to pass comprehensive insurance measures were vetoed by then-Gov. Charlie Crist. Even though there is now a new pro-business governor, the initial focus by the bill’s main sponsor is not on rate regulation, but on the cost drivers affecting the bottom line of insurance companies.
The major bill, SB 408, unveiled by Richter would require that a sinkhole claim be filed within two years of the incident that caused the damage.The legislation would change the definition of what damage is covered by sinkhole coverage and allow insurers to apply a deductible to policyholders to cover the cost of investigating the claim. The legislation would also require homeowners to start repairs within 90 days of the confirmation of a claim.
The legislation changes the use of neutral evaluators of the property and the legal weight that must be given to reports from the evaluators.
While Richter is concentrating his focus on cost drivers, that does not mean there won’t be other significant property insurance reforms during the annual session that starts March 8. It is likely that there will be attempts by other lawmakers to change Florida law regarding insurance rates, as well as an effort to make major changes to Citizens Property Insurance Corp., the state-created carrier that is now the largest property insurance company in Florida.
Gov. Rick Scott has vowed that he will tackle property insurance reforms in the coming year, but he has yet to unveil any substantive plans. Scott said during his campaign that he would like to eliminate the power that both Citizens and the Florida Hurricane Catastrophe Fund have to charge assessments on most insurance bills. “We have got to deal with property insurance, so I’m going to put a lot of effort into that so that Citizens becomes the insurer of last resort as quickly as possible,” Scott said right before he was sworn in as governor.