Insurance Proposals Scorned

Article Courtesy of The Tampa Tribune

Published  October 13, 2006

LARGO - So many angry people came to complain Thursday about rising home insurance rates that state officials were forced to split up and simultaneously take testimony in three separate rooms.

Many speakers said annual premiums have become unaffordable and pleaded with Gov. Jeb Bush's 15-member insurance reform task force to take action before homeowners are forced to sell and move out of Florida.

Some residents complained about annual insurance bills approaching $5,000. But for David Sheppard, a senior citizen living in a mobile home in St. Petersburg, $900 was too much. That's what the state-sponsored insurer of last resort, Citizens Property Insurance Corp., wants to charge him, a threefold increase over what he had been paying a private insurer.

So far, he has refused to pay, instead opting to have no home insurance since his policy was canceled months ago by a private insurer.

"It's unjustified," Sheppard said about the premium Citizens wants to charge him.

The public comment lasted for an hour, with the rest of the 9 a.m. to 4 p.m. meeting at St. Petersburg College in Largo centering on various panels discussing potential solutions. Suggestions by task force members to deregulate insurance rates, allowing insurers to charge whatever they want, and to curb powers of the state's consumer advocate didn't go over well with many in the audience. More than 300 people attended the event.

"The task force seems to be siding with the insurers," said Ginny Stevans, president of New Port Richey-based Homeowners Against Citizens Inc. Stevans said consumers' voices were being ignored.

The insurance industry has been pushing to end state regulation of homeowners insurance rates. They maintain that stopping what they say is rate suppression ultimately will cause more insurers to enter the market, creating competition that will lower rates.

The Largo meeting was the sixth for the task force, which is made up of 12 Republicans and three Democrats is run by Lt. Gov. Toni Jennings.

Task force members insist they are working on a bipartisan basis to find solutions to Florida's insurance crisis. Thursday's meeting took on political overtones as two South Florida Democrats in the state Legislature, Sen. Steven Geller of Hallandale Beach and Rep. Dan Gelber of Miami Beach, presented to the task force what they called the Democrats' property insurance plan.

The plan calls for the state to assume the bulk of the risk of the first $100,000 of homeowner's insurance coverage. Alleviating insurers of that risk would encourage now-reluctant insurers to increase their writing of policies in Florida, the legislators said.

Committee members questioned what would happen if a Category 4 or Category 5 hurricane were to hit the Bay area, causing an estimated $100 billion in damage.

Gelber countered that no matter what insurance system the state has in place, such a major loss would cause major financial problems for Florida residents, insurers and the state.

Jennings said the task force plans to present a final report to Bush in November. She said a special session of the Legislature is expected to be called by Bush after that to deal with the insurance issue.