News & Updates


Bill Proctor: Floridians deserve choices for insuring their homes

By Staff Reports

Tuesday, December 29, 2009

The majority of Floridians living in the coastal areas are aware that we have problems within our property insurance system. Today, many homeowners along the coast have only one option, the state-run Citizens Property Insurance Corp.

Floridians want and deserve more choices when it comes to property insurance. Homeowners want the option to buy coverage from private insurers, not just from the state. Just like purchasing groceries, gas or even your home, you should have the right to choose who you buy from and what price you are willing to pay.

Consumers also are concerned about their insurer’s ability to pay their claims if a major hurricane hits. They want to be insured by a company they know and trust will be able to meet its obligations. Many Floridians are not aware that they are subject to thousands of dollars per family in state-issued, post-storm assessments on their homeowners, auto, boat and business policies if Citizens is unable to pay its claims.

These are the reasons that I sponsored the Consumer Choice property insurance bill in 2009 and have reintroduced it for the 2010 legislative session. While the impetus for this bill had nothing to do with State Farm’s situation, I am pleased to note the settlement with state insurance regulators that will allow the company to continue providing homeowners coverage in Florida. However, the state’s precarious property insurance problem remains as threatening as ever, and this bill is sorely needed.

During the 2009 session, we learned that consumer choice in homeowner’s insurance is broadly supported by Florida’s voters, the business community, most state newspaper editorial boards and the vast majority of state legislators. In fact, more than 85 percent of House and Senate members supported consumer choice. A Florida Chamber of Commerce poll showed that 60 percent of voters supported the Consumer Choice property insurance bill and wanted the governor to sign it.

Gov. Charlie Crist articulated some concerns with the bill. The 2010 version of the bill (House Bill 447/Senate Bill 876) has addressed the governor’s concerns and has been refiled for the coming year.

Since last spring, Florida has seen an even further deterioration of our private insurance market. Insurance Commissioner Kevin McCarty recently testified that 102 out of 210 property insurers are losing money, and three Florida property insurance companies went insolvent, all without any hurricanes. In addition, the majority of the $4 billion in new private claims-paying capital that has been touted as entering Florida has now been accurately attributed to unlicensed surplus lines insurers that charge unregulated rates and don’t serve average homeowners.

The Consumer Choice bill is designed to allow consumers to decide for themselves if they want to have their home protected by a private insurer offering market-based rates. Purchasing a Consumer Choice policy is completely voluntary.

The whole purpose of the Consumer Choice bill is to give people the choices they want for buying homeowners insurance in the private market. The bill also encourages private insurers and their desperately-needed private claims-paying capital to come back to Florida. And it reduces the threat that if Florida is hit with a major hurricane, the state might not be able to pay all its claims.

Proctor, R-St. Augustine, is a member of the Florida House and a sponsor of the Consumer Choice bill.