Spur Competition or Just Rate Increases

On Monday, Florida House GOP leaders proposed new legislation for the regulation of homeowner’s insurance. With this Legislation, homeowners insurance rates could jump as much as 25% a year without government oversight by the state's Office of Insurance Regulation. Backers of this bill feel this method will spur competition between insurers in an open, competitive market. Consumer advocates are warning that this move will make the purchase of homeowners insurance out of reach for many Floridians who are already facing double-digit rate increases in their premiums this year. Under this proposed legislation, property owners claiming a homestead exemption would receive smaller increases based on Citizens’ Insurance rate losses but owners of non-homestead properties would face higher rate increases. This bill will pit inland homeowners against those living within hazard areas, like beach properties, by allowing insurance companies to assess premiums based on risk. It needs to be noted that homes requiring more than $1-million in insurance coverage will be ineligible to receive coverage from Citizens Insurance. Republican backers have included provisions to make it easier for homeowners to get no-interest loans to fix up their homes, making their homes more resistant to hurricanes, with a $100 million “damage prevention endowment” from the state general revenue funds. Keep a close eye on this legislation as it makes its way through the Florida House and Senate because it will have an impact every property owner in the state of Florida.