“Those who do not learn from history are doomed to repeat it”-G.Santayana.
While the influx of some 24 new entrants into the Florida homeowners' insurance market since 2006 is certainly welcome news, as consumers and industry people, we need to ask ourselves some basic questions. First, how can we — and insurance regulators — be certain that all of these recent entrants have the financial security and underwriting discipline to be there if and when they are most needed? Second, does this concentration of new entrants compound the risk to the overall market in any way?
Certainly the current global financial crisis raises further concerns regarding the need for increased regulatory controls and diligence along with the potential cost and availability of capital should the state of Florida ever need to tap into the bond market to cover catastrophe losses. One of the critical issues of the current financial crisis has been the lack of government regulatory oversight of the non-insurance subsidiaries of insurance holding companies.
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