The American Insurance Association said when the Florida legislature reconvenes tomorrow it will be supporting a bill designed to cut the size of the state-operated reinsurance fund.
AIA said the proposal from State Chief Financial Officer Alex Sink would reduce the state reinsurance catastrophe fund coverage from $28 billion to $25 billion.
As a result, AIA said, the amount of money the cat fund would have to raise through the issuance of bonds and subsequent assessments on policyholders would be trimmed back.
According to AIA, the bill has won unanimous support in the House Jobs and Entrepreneurship Council and is expected to move to the House floor early in the legislative session.
AIA said it will also urge that legislators begin the process of returning the state's Citizens Property Insurance Corporation to a true insurer of last resort, reversing the course taken last year that allowed Citizens to more directly compete with the private market.
Removing commercial and auto policies from Citizens' assessment base will also be a top priority, AIA said.
Although property insurance issues are expected to dominate, AIA said it also plans to push for legislation to renew the public records exemption for insurers' use of credit scoring models. The current exemption expires this year.
AIA said it will fight any attempt to weaken or repeal any of the legal reforms enacted in 2006, most specifically the repeal of joint and several liability.
In addition, the trade group said Florida's civil justice environment continues to pose challenges for insurers, and "AIA will oppose any measures that attempt to make the state more litigation-friendly."
Cecil Pearce, AIA vice president, southeast region, said in a statement that the legislature's actions last year had provided property-casualty rate relief, but "it came at a high cost: imposing on policyholders a [potential] hurricane tax totaling potentially billions of dollars that must be paid in the event of a major storm."
"We hope that legislators will rethink that policy, and instead look to long-term, market-based solutions that encourage additional private capital to enter the state's property insurance market, instead of putting a fence around Florida and relying on the government and taxpayers to fund hurricane losses after the fact," said Mr. Pearce
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