Florida Surplus 'Take-Out' Bill Sacked

NU Online News Service, March 7, 12:09 p.m. EST

Lawmakers in Florida gave up on a bill industry experts say would have at least given homeowners another insurance option.

HB 245, a measure that would have allowed surplus lines carriers to depopulate the bloated insurer of last resort, sputtered and died during the last week of the legislative session.

“It just became really controversial,” says Samuel Miller, executive vice president of the Florida Insurance Council. “Whenever there’s a chance rates could raise, even if it’s in the best interest, these types of measure are tough to get through.”

Citizens Property Insurance Corp., run by the state, has grown beyond its means to become the leading property insurer in Florida. The bill was intended to reduce some of the insurer’s exposure by allowing the nonadmitted market to take policies.

Detractors worried policy rates would increase, especially because surplus carriers are not regulated.

Miller says the state Senate attached an amendment that would have required insurers to get written prior approval from homeowners before a take-out could occur.

“It wasn’t practical,” he says. “That would have potentially required tens of thousands of signatures.”

When the bill traveled back to the House, which had already passed the measure, they chose not to strip the amendment—effectively ending the bill’s journey days before the session is scheduled to end.

The death of HB 245 did not sit well with the free-market think tank Heartland Institute.

“This would have reduced the overall exposure of Citizens, transferred that risk away from taxpayers, and decreased the likelihood or severity of every Floridian having to pay post-hurricane taxes. Unfortunately the legislature today opted against expanding consumer choice,” says Christian Camara, Florida director for Heartland.

Former state legislator and Heartland senior fellow Don Brown says he doesn’t think most Citizens policyholder understand they are at risk of being surcharged up to 45 percent if a storm occurs. Citizens is then able to levy assessments on most Florida policyholders.  

“Worse still is the assessment risk that will now continue for millions of non-Citizens policyholders in Florida,” he says. “As for me, I’ve had about all the legislature’s consumer protection that I can afford.”

Comments

Resource Center

View All »

Top 10 Legal Requirements for E-Signatures in Insurance

Want to make sure you’ve covered all your bases when adopting e-signatures? Learn how to...

Get $100 in leads with $0 down!

NetQuote's detailed, real-time leads have boosted sales for thousands of successful local agents across the...

The Growing Role of Excess & Surplus Lines in Today’s...

The excess and surplus market (E&S) provides coverage when standard insurance carriers cannot or will...

Increase Sales Conversion with this Complimentary White Paper

This whitepaper will share proven techniques - used by many of the industry's top producers...

D&O Policy Definitions: Don't Overlook These Critical Terms

Unlike other forms of insurance where standard policy language prevails, with D&O policies, even seemingly...

Environmental Risk: Lessons Learned from Willy Wonka and the Chocolate...

Whether it’s a chocolate factory or an industrial wastewater treatment facility, cleanup and impacts to...

More Data, Earlier: The Value of Incorporating Data and Analytics...

Incorporating more data earlier in claims lifecycles can help you reduce severity payments by 25%*...

How Many Of Your Clients Are At Risk Of Flood?

Every home is vulnerable to flooding. Learn four compelling reasons why discussing flood insurance with...

Gauging your Business Intelligence Analytics Capabilities and the Impact of...

Big Data, Data Lakes and Data Swamps, How to gauge your company's Big Data readiness....

Extending Contact Center Capabilities Across the Insurance Enterprise

Today advancements in technology are making a big impact on business and society. To yield...

Looking for Markets?

Search Kirschner’s Insurance Directory to help service your hard to place risks.

497 Risk Categories | 70,000 P&C Insurance Markets

kirschners
Specialty Markets Insight eNewsletter

Receive updates and analyses on hard to place and challenging coverages. Sign Up Now!

Advertisement. Closing in 15 seconds.