Ever since Florida Gov. Charles Crist signed legislation early this year to vastly expand the public catastrophe funds capacity, while allowing primary insurers to buy discount reinsurance from the state, Tallahassee has been on the industry's case, pushing for anticipated rate reductions they believe is due to homeowners. The fight is getting ugly, and it could get a lot worse before long, with vague charges of collusion in the air.
The law's champion, Republican Gov. Crist, hammered away at the industry over the summer, accusing insurers of breaking their promise to cut homeowners insurance rates to Florida residents by at least 24 percent to reflect their savings in reinsurance costs.
Carriers were quick to lash right back, insisting that a 24 percent cut was never promised by the industry, and instead was nothing more than an estimate from state officials and regulators wearing rose-colored glasses–indeed, more of a fantasy of the best-case scenario, rather than an actuarially-sound prediction.
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