News & Updates


Mitigation Discounts Take Center Stage

By: Travis Miller

Issues relating to Florida’s windstorm loss mitigation discount program have been the focal point of several recent meetings and will be the subject of continuing review this fall.  The Florida Legislature in the 2009 session directed the Florida Commission on Hurricane Loss Projection Methodology to hold public meetings and receive testimony for the purpose of analyzing Florida’s implementation of the mitigation discounts and developing recommendations for improving the system.  Separately, the Office of Insurance Regulation recently held a workshop to discuss potential revisions to forms used in the mitigation discount process.

Modeling Commission Review

The modeling commission recently held its initial meeting to gather information about the mitigation discount requirements and hear from affected parties about concerns with the process.  RTYC shareholder Travis Miller led off the modeling commission’s meeting with an overview of the statutes and administrative rules that govern mitigation discounts.  Although the presentation was scheduled to be a brief overview that would set the stage for further discussions, the commission jumped in with questions and considerable discussion of the issues raised by policy decisions underlying the implementation of the discounts.  It soon became clear that discussion of these issues does not fit neatly into groupings such as legal, actuarial, etc.  The meeting included discussion of insurers’ appetite for risks when discounts are perceived to be too low, as well as concerns with implementation of the table as a discount-only table that assumes any home better than the weakest structure will qualify for some type of discount.  The commission also heard about rampant errors, both unintentional and intentional, in the completion of mitigation discount forms.  The commission will meet again on September 17 for further discussion of these issues.

Office of Insurance Regulation Workshop

The Office of Insurance Regulation conducted a workshop to discuss revisions to the notice form used by insurers to inform policyholders of available discounts and the verification form used by policyholders to request mitigation discounts.  The workshop was well-attended, with representatives of engineering firms, contractors, inspectors and others involved in the business of inspecting homes comprising the largest segment of the audience.  Participants had relatively few questions about the notice form.  Most notably, one industry representative remarked that the form should not imply that both mitigation discounts and deductible reductions are available when insurers typically do not offer both.  The inspection form attracted much more attention.  Although much of the discussion centered on disagreements among members of the inspection industry about who should be able to sign the forms, the insurance representatives offered a number of suggestions for ways the form can be revised to limit erroneous and fraudulent submissions.  Travis Miller attended this workshop and provided comments in this area.  Please contact Travis or any of our insurance professionals for additional information about the status of these forms or the mitigation discount review process in Florida.