Political hurricane on horizon

Florida's insurance crisis is erupting into a political volcano that could overshadow other election issues.

Article Courtesy of The Miami Herald

Published  September 2, 2006

The eight hurricanes that ravaged Florida in the past two years have taken a heavy toll, destroying homes, causing $36 billion in damages and creating an insurance crisis. But they may also done something once unthinkable: shaken the strength and unity of the GOP.

That's because the insurance crisis -- with its repercussions of higher rates and dropped policies -- is spiraling into a political storm that has provoked even some GOP politicians to turn on their own ranks with stunning ferocity.

Fears of a backlash over rising insurance rates have prompted GOP leaders to consider suspending their campaigning in order to hold a special session before the November general election.

The issue also may finally give Democrats -- who have been complaining about the Republican response to rising insurance rates -- a way of snapping their losing streak in statewide elections. Some of the areas of the state that have been hit hard by storms, and by insurance woes, have long been dominated by Republicans. And the two major Republican candidates for governor sit on the panel that oversees the agency that regulates insurance in Florida.

A new poll conducted for The Miami Herald by Zogby International showed that ''hurricane insurance'' is one of the most important issues facing the state of Florida.

Likely Republican voters ranked it first among a list of problems bedeviling the state, while likely Democratic voters ranked it second, behind education.


Such findings probably aren't surprising to top politicians. Gov. Jeb Bush said Friday insurance problems remain a ''huge challenge'' and said GOP leaders are looking for answers.

''I believe the insurance problems created by our hurricanes is a huge challenge for our state,'' Bush said in an e-mail response. ''If we can reach consensus on how to deal with the reinsurance problem and to provide some relief, we should act. There is no need for this challenge to divide the Republican Party. We are looking for suggested solutions.'' Democrats, who began hitting Republicans over insurance before the 2006 legislative session last spring, said the poll results are not unexpected. Democrats voted against a GOP-backed insurance bill that passed in the waning moments of the session, saying it would do little to help consumers. ''It's sort of like the train bearing down on you in slow motion. Everyone knew it was coming,'' said Rep. Dan Gelber, a Miami Beach Democrat and incoming House minority leader. "This is an issue that is righteously at their doorstep. It is absolutely on their shoulders. They are walking around with the stench of this problem emanating from them like a new skunk smell.''

Homeowners' insurance has already become a major issue in the governor's race, as well as the race for chief financial officer, where two of the Republicans fighting in the primary for that post were on opposite sides of the bill the Legislature passed.

The four major candidates for governor have offered several alternatives, ranging from making it easier for insurance companies to tap into a state reinsurance fund to forcing companies that sell auto insurance to offer homeowners' insurance. State Sen. Rod Smith has embraced a plan, first unveiled by House Democrats, to have the state cover windstorm damages for the first $100,000 worth of damages for each home.

Rivals have picked one another's plans apart as either thin, unrealistic or unlikely to provide any rate relief.

''Charlie Crist went from having no idea about insurance to embracing bad ones,'' said Alberto Martinez, a spokesman for Tom Gallagher, Crist's opponent in the GOP primary for governor.


Gelber pointed out that one of the main ideas offered by both Gallagher and Crist is to encourage Congress to authorize a national catastrophe fund that would provide reinsurance to companies -- not likely to happen any time soon, he said. ''You can't hitch your wagon to a dream,'' Gelber said.

Democrats, however, aren't alone in their criticism of how Republicans have responded to the state's insurance crisis so far.

During a Coral Gables meeting in late August, state Rep. Juan Zapata, a Miami Republican, blamed fellow Republicans for the problem and even said the chairman of the House Insurance Committee as being "in the pocket of the insurance industry.''

''The Republican Party has failed you, and not because we haven't tried, but I think we haven't tried hard enough,'' Zapata said.

State Rep. Randy Johnson, a Central Florida Republican running for chief financial officer against GOP Senate President Tom Lee, has tried to tap into homeowner anger over insurance as a central part of his campaign.


Johnson has proposed freezing insurance rates in the near term and eventually providing more deregulation for the insurance industry to have more insurers willing to operate in Florida.

''We had a huge opportunity to fix it, and a whole bunch of good ideas that were available to the Legislature that we refused to listen to because they didn't come from people who spent millions to impact the process,'' said Johnson, referring to campaign contributions made by the insurance industry.

Lee bristles at Johnson's criticisms, saying lawmakers have enacted ideas opposed by insurance companies, forcing them to change policies on deductibles.

Lee also predicted that after the primaries, the GOP will ''go on the offensive'' to show how they have tried to help, citing $715 million spent to reduce assessments charged by Citizens Property Insurance -- the state-sponsored insurer of last resort -- and the $250 million to harden homes so they can better stand up to future storms.

''I think the demagogues have gotten a head start,'' said Lee. "There's a lot of people out there who rather curse the darkness than light a candle.''