Florida lawmakers told us that this week as the state keeps waiting for the promised property insurance relief. It follows rounds of major reforms to aid the ailing market, yet regulators keep saying change will take more time.
“We all feel it— we have all seen rate increases take place,” said Florida Insurance Commissioner Michael Yaworsky, Tuesday. “OIR staff– we’ve approved rate increases on ourselves. Everyone is in this together.”
Yaworsky, the state’s chief insurance regulator, was speaking to the press after addressing a Senate committee meeting earlier in the day. The commissioner continued to warn that changes Florida’s legislature installed over the last two years still needed a chance to fully influence the market. That’s despite lawmakers estimating in May of last year 12 to 18 months could be sufficient.
“We do need to let these things come in and have an impact,” he said. “If we need to do something larger, I think the state has the ability to do it if it’s not seeing the results it needs — but right now, we need to see how this goes.”
Yaworsky said the reforms limiting lawsuits and adding oversight were showing initial signs of improvement. He noted five new insurers plan to enter the market. The number of new policies companies are writing continues to increase. Plus, at least one major carrier, State Farm, has reaffirmed its commitment to Florida.
Some Republicans also speculated that national issues are stymying Florida’s rebound. Sen. Blaise Ingoglia (R-Spring Hill) wondered if inflation was behind the Florida market’s most recent losses.
“We’re having competing forces,” he said. “If we were not in an inflationary environment — that number would probably be positive, and we would have an even more vibrant market. Would that be accurate in your assessment?”
“I would say the market would certainly be better,” Yaworsky responded.
Even so, Floridians remain on the hook for big premium bumps, dropped policies, and a generally uncertain future. Sen. Bobby Powell (D-West Palm Beach) is among the Democrats who have questioned if the legislature needs more hands-on action, like rate caps or a national pool.
“We can say what we want — but people are going to be losing their homes, literally losing their homes because they cannot afford to pay the price of insurance right now,” Powell said. “People are suffering now.”
Direct market intervention is still a no-go for much of the GOP majority. Members worried it would backfire and drive more insurers out of Florida. That’s a tune that seems unlikely to change as the 2024 session creeps closer.
Meanwhile, the Office of Insurance Regulation said it would release more reform recommendations for lawmakers to consider ahead of the session. Officials didn’t offer many specifics— but did want to include better public education on insurance.
Tuesday also marked the deadline for thousands of Floridians to decide whether to stick with the state-backed insurer of last resort, Citizens Property Insurance.
As part of Citizens’ effort to cut its number of policies, officials recently notified some 300,000 Floridians they had until Oct. 10 to either accept or decline private plans from “takeout companies.” Some Floridians will have no choice if the outside offer is less than 20% higher than their current rate.
Citizens has become Florida’s largest property insurer with about 1.4 million policyholders. CEO Tim Cerio has called that number unsustainable. He’s pushing to move more to the private sector as soon as possible and advocating for further increases in Citizens’ rates.
The chief executive hoped that would bolster competition and eventually lower prices.
“Nobody wants to get hit with a huge increase— but when Citizens is running 30% to 40% below market, it’s very difficult to have a takeout company come in to compete with that,” said Cerio.
As Florida’s property insurance crisis has deepened, Citizens has continued to swell with policies. Five years ago it had less than a third of the policies it does currently.
Source: ABC Action News
