MIAMI (CBS4) – As the Florida legislature moves to deregulate the homeowners insurance business; there is a late, but growing, opposition to proposals that have drawn little publicity, but promise big premium increases.
Several measures in the Republican-controlled legislature would allow the state-run Citizens Insurance company, and private companies, to impose large rate increases with no questions asked.
Governor Rick Scott suggested he supports an overhaul of the state’s homeowners insurance system, and is a supporter of deregulation. Democratic opponents call the measures an attack on consumers.
“They really don’t do anything but line the pockets of insurance company executives and leave homeowners throughout the state out in the cold,” said Rep. Evan Jenne on Monday.
Jenne, a Democrat from Broward County, said homeowners need to “let their lawmakers know they don’t want this” legislation if it is to be defeated.
Among other things, the measures would raise limits on increases that can be imposed by Citizens, and allow private companies to enact rate hikes without regulatory review.
Proponents say the deregulation would help Citizens maintain solvency in the event of catastrophic claims; and permit other companies to more fairly compete with Citizens whose rates have been kept artificially low.
Supporters also believe the measures would encourage more competition among insurance companies and could eventually lead to lower rates. The insurance industry has pleaded poverty in lobbying for reforms and rate hikes.
The opposition counters that the industry has refused to open up its books, and has played a fiscal “shell game” with subsidiaries created specifically to write Florida policies.
“We haven’t had a major storm in five years, in five long years, and they’re saying that they still can’t make money,” said Broward’s Jenne in an interview from Tallahassee with CBS4’s Gary Nelson.
Homeowners frustrated by increasing insurance costs gathered Saturday afternoon to protest the proposals in the legislature.
Floridians In Action, the group organizing against the hikes, said the bills being introduced in the state House and Senate will further depress cash-strapped homeowners and increase unemployment.
They expressed their discontent by gathering at Tropical Park from noon to 3 p.m., waving signs, shouting and urging passing motorists to honk their horns. There were a lot of horns blowing.
“We just can’t take it anymore,” said Emiliano Antunez, a homeowner who joined the protest Saturday.
Luis Meurice was another angry voter in the group.
“It’s just a habitual problem with [insurance companies], just sticking their hands in our pockets and we are fed up with it,” Meurice said.
Floridians In Action issued a statement saying insurance companies and their Tallahassee enablers “have emptied your pockets through higher insurance rates, which have affected employment(and)…affect every single business and Floridian.”
The group is protesting the following bills:
- SB 1714 and HB 1243 would give Citizens Property Insurance Corporation the right to raise premiums by as much as 25 percent – a 10 percent increase over what state law currently allows.
- SB 1462 and HB 4115 would do away with a state law that requires a consumer advocate group to score insurance companies based on claims handling.
- SB 1330 and HB 885 would allow insurers to hike premiums by as much as 30 percent a year without approval from regulators.
- SB 408 and HB 803 proposes shortening the time homeowners have to file hurricane and sinkhole claims. Insurance companies could be allowed to drop sinkhole coverage all together.
At Pete’s Barber Shop in Pinecrest Monday customers were outraged to learn details of the proposed deregulation.
“I don’t think it’s a very good idea, I don’t think that most people can afford it now,” said Dave Ferguson, a homeowner who says he pays “about $5,000” a year for insurance already.
Sitting in the next chair over, Bruce Troen echoed the discontent.
“If you get rid of most of the regulation; then abuses will occur and homeowners will suffer,” Troen said.
Doug Bertner, who owns a home in Kendall, said he has been priced out of insurance coverage.
“I don’t have homeowners insurance,” said Bertner, who has paid off his mortgage and isn’t required to carry a policy. “I’m just keeping my fingers crossed that nothing catastrophic happens.”
If you’d like to contact your representative to give your voice either in favor, or opposing, the planned insurance reform, click here.