Editorial: State must act on insurance
Editorial • June 26, 2009
Now that Charlie Crist has vetoed an attempt to lure State Farm and other big private companies back into insuring property against windstorms, Tallahassee cannot afford to stand still.
Either the Legislature must override Crist’s veto, or the governor and lawmakers must work to find another way of getting more insurance capital built up in Florida.
Otherwise, a catastrophic storm like the ones we experienced in 2004 and 2005 will force the state (the taxpayers) to borrow huge amounts in a tough bond market. That’s because the state-backed Citizens Property Insurance Co., now the leading insurer against storms, and the state Hurricane Catastrophe fund lack the reserves to deal with billions in reconstruction costs.
This game of chicken has gone on long enough. Crist tried to beat down insurance rates, but the big companies stopped writing new policies. Now Crist has thrown down another challenge by vetoing a bill that would have allowed larger companies to charge whatever they wished, and let consumers choose among the competitors, including Citizens.
Crist should have given the reform a chance, even though rates would have gone up. The current system not only leaves the taxpayer on the hook in the event of a catastrophe, but the ratepayer will still face huge surcharges to help pay for reconstruction.
Better to have both private and public resources building up over the years to buffer us against the storm.
Urge our leaders to act.
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