Pasco County homeowners will get a chance next month to air their thoughts on a proposal to make sinkhole insurance optional by state-run Citizens Property Insurance Corp.
Citizens, which writes a third of the homeowners policies in Pasco, wants approval from the Florida Office of Insurance Regulation to allow non-high risk account customers to drop sinkhole coverage. Sinkhole claims have driven rate increases up by as much as 139 percent in parts of Pasco this year, and caused spikes in Hernando and north Pinellas counties, too.
For customers who drop sinkhole coverage, cracks and other smaller damages would no longer be covered. But a home destroyed by a sinkhole would be covered by Citizens' catastrophic loss provision.
Customers who opt to keep sinkhole coverage would have to pay more than they do now. A 10 percent deductible would be required, too.
State regulators plan a three-hour public hearing at 5 p.m. Dec. 18 at Spartan Manor. And some of the most vocal critics - the Pasco-based Homeowners Against Citizens Florida - will come out in large numbers, president Ginny Stevans said Tuesday.
One issue will be whether Citizens' proposal meets a state mandate that requires insurers to offer sinkhole coverage. State Rep. John Legg said the proposal appears to do so by offering optional coverage and providing coverage for "catastrophic" losses. It is also unclear whether mortgage companies will allow homeowners to drop the sinkhole coverage.
While area lawmakers such as Legg, R-Port Richey, applaud Citizens' proposal, Stevans said it's not a long-term solution, but "it's something."
Citizens estimates rates without sinkhole coverage could be up to 56 percent lower in Pasco when the new coverage takes effect March 1. For a home now paying $2,505, the premium would be $1,090.
"What would be the first step?" Legg asked, responding to critics. "I think it's a big first step."
Legg said lawmakers will push for more changes if there is a special session this year, and if not, in next year's regular session.