Over the last five years, Florida’s property insurance market has gotten way out of control — it’s time for state leaders to take action. Here’s what to do.
TAMPA, Fla. – In case you missed it, Senator Rick Scott wrote an op-ed for the Tampa Bay Times urging state leaders to immediately take three actions focused on fixing Florida’s property insurance crisis. While Governor of Florida, Senator Scott successfully implemented solutions to drive growth in the private insurance market and reduce the size of Citizens Property Insurance, returning it to Florida’s true insurer of last resort.
While property insurance is regulated by the state, Senator Scott is fighting at the federal level to reform the National Flood Insurance Program (NFIP). In August, Senator Scott wrote a letter to David Maurstad, Senior Executive of the NFIP, demanding transparency and accountability as FEMA’s Risk Rating 2.0 has unfairly increased flood insurance rates for millions of Floridians, making the coverage nearly unaffordable for working families who need it. Earlier this year, Senator Scott reintroduced three bills, the Removing Barriers to Private Flood Insurance Act, the Flood Insurance Consumer Choice Act, and Flood Insurance Transparency Act to reform the National Flood Insurance Program (NFIP) which would help lower the cost of flood insurance, build a more robust private market, and ensure the property insurance market better serves Florida families. Senator Scott’s NFIP package has been endorsed by the Federal Association for Insurance Reform (FAIR). Senator Scott will also be introducing legislation in the U.S. Senate soon to ensure every NFIP policyholder has the option to pay their premium bill monthly, instead of annually, to help provide relief from rising costs.
In the op-ed, Senator Rick Scott wrote, “Florida has a property insurance crisis on its hands, and families are hurting. Hardworking Floridians are facing skyrocketing inflation from Bidenomics, and now we are seeing insurers, like AAA and Farmers, flee the state, leaving folks with less choice and higher premiums.
When I was governor, we aggressively worked to make sure Florida’s private insurance market grew so Floridians would be provided with more choice. Today, the opposite is occurring and with companies leaving the state, Citizens Property Insurance Corp., Florida’s state-run insurer of last resort has grown threefold since I was governor.
…At its current size, Citizens cannot cover all the claims it is responsible for if we had a massive storm because it is no longer fully funded like it was when I left office. The only way that Citizens could pay all claims would be to either force higher fees on policyholders, force the state into new tax assessments on Florida families — or both. That is unacceptable.
Over the last five years, Florida’s property insurance market has gotten way out of control — it’s time for state leaders to take action, I urge them to start with three critical things:
1. Grow the private insurance market that increases competition and is responsive to Florida homeowners. This is not easy, but I did it, bringing back State Farm, which had quit on Florida the year before I became governor. It is imperative that as the private insurance market grows, state leaders continue the critical work each and every year to put measures in place to stamp out fraud and abuse which often leads to higher rates on customers, while making certain there is oversight on excessive rate increases.
2. Implement additional reforms on the private insurance market to ensure that Florida families are treated fairly, paid for their claims in a timely manner and guaranteed a transparent notification process regarding any changes in coverage. Right now, state law requires that insurance companies give policyholders notification of non-renewal 60 days before their policy is dropped. This should be expanded to at least 120 days. If you get dropped from your insurance, you could lose your mortgage.
3. Shrink the size and scope of Citizens to again make it the insurer of last resort, drive down insurance costs and make sure that it’s fully funded and can pay every legitimate claim made by policyholders…
As your former governor, I know that regulating property insurance is a state issue. I had to deal with it when I was governor, nobody else came in to fix it.
I know that the leadership at Citizens is working to shrink its policy load and has the expertise to get this done. I also believe that state leaders are serious about getting this problem under control, and are considering calling a special session to do whatever it takes to accomplish the three goals I outlined.
The possibility of a hurricane impacting our state is a constant reality but it should not financially strangle Floridians or kill the dream of owning a home in our state. It does require a great deal of work, and it requires that the state get on it right away.”
Read the full op-ed in the Tampa Bay Times HERE.