Commercial real estate owners favor insurance deregulation
Friday, February 12, 2010
Orlando Business Journal – by Christopher Boyd Staff Writer
Chuck Whittall, who has more than two-thirds of his firm’s retail property portfolio in hurricane-prone Florida, has a keen interest in the high cost of property insurance.
The owner of Unicorp National Developments, said his Orlando development and management firm pays more than $100,000 in property insurance costs every month, a huge bill that takes a bite from his bottom line. That’s why he’s “a big believer in deregulation of the insurance industry.”
This spring, Florida lawmakers will consider an expanded version of a proposal they passed in 2009, which Gov. Charlie Crist rejected. It would allow home insurance firms to set their own rates — a step supporters say would allow insurers doing business in Florida to improve their solvency.
They argue that the legislation would lower the risk of poorly financed insurers defaulting on claims after a major storm, which would force regulators to collect money from businesses and residents to make up for the shortfall.
Whittall, who supports the proposal, see another advantage to deregulation. More carriers would start doing business in Florida, he said, and the increased competition would lead to lower insurance premium rates.
Associated Industries of Florida agreed and said it would like to see another bill extending deregulation to commercial property.
“If your rates go down 15 to 20 percent, it would make a huge difference in how well your business does,” said Whittall, whose properties include The Fountains and Bellagio on Sand Lake Road. “We pay so much for insurance now that it would almost make sense for us to enter the insurance business.”