backs insurance reform plans
Article Courtesy of The Tallahassee Democrat
Published January 13, 2007
TALLAHASSEE -- Gov. Charlie Crist is placing the power of his office
behind parts of the insurance reforms House and Senate lawmakers have
unveiled to rapidly lower hurricane insurance premiums to millions of
Crist announced today in a press conference that he supported Senate plans
to make Florida ratepayers the ultimate re-insurer for companies -- a move
that could quickly cut rates by saving companies the cost of buying
private catastrophic backup coverage.
In exchange for offering insurance companies cheaper catastrophic
reinsurance, Crist said the proposal must require any savings be passed on
"We must mandate meaningful and broad-based rate relief for
homeowners," Crist said. "The House and Senate are now holding
the industry's feet to the fire."
He also blessed the idea of reforming the state-run Citizens Property
Insurance, by rolling back recent rate hikes and allowing it to compete
with the private market by offering competitive rates as well as other
lines of coverage besides wind-damage insurance. He also said he supported
the House idea to reshape Citizens by replacing its board.
Crist also seized on House efforts to incorporate his campaign pledge to
stop national insurers from setting up Florida-only subsidiaries, and
forcing auto insurers to also offer some form of property coverage if they
do so elsewhere.
He said the state would probably need to go slowly in ending the use of
subsidiaries so existing policies aren't dropped.
"We want to make sure that nobody loses the coverage they have with
an existing company, so maybe a phase out is the best way to do it,"
One relatively new proposal Crist said he was supporting would police the
profits that companies expect to make when they seek rate increases and
requiring money be returned to consumers if those rates of profit are
Even though he campaigned as a Ronald Reagan Republican, Crist said it was
impossible for state government not to impose itself further into the
middle of the private market.
"I am a less-government guy but I also understand the practical
reality of where we are," Crist said. "We've had some dramatic
couple of years that have put Floridians at risk, and we have an
obligation to do everything we can to help them."
Virtually all of the ideas Crist discussed have been proposed already by
lawmakers. And some of the more controversial ones for the industry --
eliminating Florida-only subsidiaries and "cherry picking" of
profitable auto insurance -- have yet to actually materialize in
legislation five days before lawmakers are set to convene a special
Crist also wouldn't name one piece of either chamber's plans he disagreed
"I'm probably the happiest guy you're going to see around Florida
today," he said.