Crist pushes for Citizens
Property to compete against private insurance firms
Article Courtesy of The Sun Sentinel
Published April 3, 2007
– Gov. Charlie Crist has quietly renewed his push to put state-run
Citizens Property Insurance Corp. into direct competition with the private
Crist recently called key lawmakers in both the House and Senate, lobbying
them to hold hearings on legislation that would allow any homeowner in
Florida to choose Citizens as his or her insurance company, even if a
private insurer also offers coverage.
Crist views a competitive Citizens, which has historically been restricted
to people who can't find coverage on the private market, as a way to force
the State Farms, Allstates and Nationwides of the world to drop their
rates at the risk of losing business. But the idea is vehemently opposed
by the insurance industry, which argues that government-supported Citizens
would be able to undercut the private insurers and ultimately drive them
out of Florida entirely.
The same issue pitted Crist against House Speaker Marco Rubio on the final
day of the Legislature's emergency session on insurance in January,
briefly threatening to derail the entire insurance package.
Under that package, consumers who are offered coverage by a private
insurance company can only select Citizens if the private insurer's
premium offer is at least 25 percent higher. The only exception, which was
added on the final morning of the weeklong special session, is for people
already insured by Citizens, who can remain with the state company no
matter what private offers they receive.
Sen. Bill Posey, chairman of the Senate Banking and Insurance Committee,
and Rep. Ron Reagan, chairman of the House Jobs & Entrepreneurship
Council, each said Crist called them recently to ask that they schedule
hearings on each chamber's respective bill that would erase the 25 percent
threshold. The bills, which would also prohibit private insurance
companies from establishing Florida-only subsidiaries, have yet to receive
a single hearing halfway through the 60-day legislative session.
Both legislators said Monday they intend to give the bills hearings. But
they also expressed some skepticism about the proposal.
"We don't want Citizens to be the only insurance company in
Florida," said Posey, R-Rockledge, though he also added, "I like
Reagan said Citizens "should be a carrier of last resort -- not a
carrier of first resort."
"I would think that if there's a company out there that's close [with
a coverage offer], we should encourage people to go there and not the
insurer of last resort," said Reagan, R-Bradenton.
Crist said he simply wants the legislation to be given a chance.
"They may or may not pass, but at least let's give them the light of
day," Crist said.