Scott Signs Insurance Bill, Rate Hikes Expected
TALLAHASSEE (CBSMiami) - Florida Governor Rick Scott signed an insurance 'reform' bill Tuesday that will allow insurance companies to raise rates, in some cases, without government intervention, and contains provisions so controversial some Republican lawmakers urged Scott to veto the bill their party passed.
The Governor's office called Senate Bill 408, "a comprehensive property and casualty insurance package. It strengthens Florida's property insurance market by addressing cost drivers associated with burdensome regulations, and confronting the sinkhole crisis."
The bill also allows insurance companies to raise premiums up to 15% per year to cover the cost of reinsurance and advertising expense, without facing regulatory oversight and review by the State Insurance Commissioner.
"It is a significant step forward to making Florida more competitive and attracting new companies into the state," Gov. Scott said in his statement.
The bill will shorten the time people will have to file a claim, and in some cases, force insureds to pay part of the cost of restoring their property up-front and then seek reimbursement from the insurance company.
The legislation Scott signed Tuesday also is aimed at reducing fraudulent sinkhole claims.
The sponsor, Sen. Garrett Richter, a Naples Republican, said in a statement that the new law will "promote a competitive market with solvent companies that our policyholders can rely on."
Critics said it would lead to higher premiums for homeowners and other property owners. Former Gov. Charlie Crist vetoed a similar measure last year.
In a related action, the State Board of Administration, chaired by Scott, filed an emergency rule giving the Florida Hurricane Catastrophe Fund more time to respond to an influx of claims from 2005 storms.
