January 09, 2007
No Easy Answers To Florida’s Pains
If anybody really thought Florida homeowners actually had any hopes of insurance rates getting to reasonable levels they need to get themselves checked. I mean the situation in Florida is so bad, it could only get better from here, or that’s what I thought. But it seems Florida haven’t seen the last of their bad days. One of the Florida Legislature's leaders on insurance issues recently said that residents seeking big relief from skyrocketing homeowners' insurance rates shouldn't get their hopes too high.
State Sen. Bill Posey, R-Rockledge, chairman of the Senate's Banking and Insurance Committee, was referring to a special state legislative session on insurance reform scheduled to start Jan. 16 in Tallahassee. What he is trying to actually do is keep the hopes low enough so any progress will give us a chance to clap our hands in mad glee.
Hurricanes have hit Florida in two consecutive years and hence the rate clock cannot be turned back to 2003 levels. Argument accepted. So what exactly does Posey suggest to ensure that Florida denizens get a better deal? According to Posey, measures that encourage more competition in the insurance industry could address Florida's insurance woes.
Posey believes that if officials force insurance companies to lower their rates, they might stop selling homeowners' policies in Florida altogether. What can be done instead is stimulate more competition in the industry. Another proposal that seems to have the potential to help homeowners is one that suggests that funding for the state-run Florida Hurricane Catastrophe Fund should be increased, and it should be made easier for insurance companies to tap into it.
There are many more interesting proposals, which may me weighed against the present circumstances. My only hope is that whatever Posey does, it should help to bring relief to homeowners. This should not be yet another attempt to take homeowners for a walk in the park while insurers rake in all the moolah.
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