Allstate Floridian Insurance Company has launched a statewide education campaign to inform homeowners on urgent property insurance reforms needed as the Florida Legislature begins its 2005 annual session.
Research conducted among Florida homeowners by Allstate Floridian reportedly revealed that many consumers are under-informed on critical issues affecting homeowners insurance such as the Florida Hurricane Catastrophe Fund, or “Cat Fund,” prompting the effort to educate and mobilize residents.
The ultimate goal of the effort is to educate consumers on the issues and to encourage lawmakers to enact meaningful reforms that result in homeowners insurance becoming more available and affordable.
The campaign includes newspaper advertisements around Florida markets, customer communications and a new Web site, http://www.helpFloridahomeowners.org .
Residents can log onto the site for current information and breaking news about homeowners insurance and Cat Fund issues being debated in the Legislature. As the session unfolds, consumers also will be able to contact lawmakers about their concerns through the site.
“Many policyholders are concerned about how the 2004 hurricane season will affect the availability and affordability of homeowners insurance in the state,” said George Grawe, general counsel for Allstate Floridian. “Through meaningful reforms such as changes to the Cat Fund, we can enact real change to directly benefit consumers by making money available to pay hurricane claims in the least expensive manner possible.”
“We encourage all Floridians to visit our Web site, www.helpFloridahomeowners.org, to become informed on these critical Cat Fund issues and to make their voice heard this legislative session.”
The Cat Fund was created by lawmakers after Hurricane Andrew to provide financial backup when disaster strikes. About 11 cents of every homeowners insurance premium dollar goes into this Fund where it grows tax-free. Yet very few Floridians reportedly know about or understand the Cat Fund. Research shows that two-thirds of Floridians have never heard of the Fund and only 1% could correctly identify the Cat Fund by name.
Unfortunately, the $15 billion Cat Fund did not help enough in 2004 because it was designed with a single mega-storm in mind, not a series of hurricanes. Just as homeowners had to meet hurricane deductibles for each storm in 2004 before getting insurance payments, insurance companies had to meet deductibles, called “retention,” before tapping into the Cat Fund.
Allstate Floridian is pushing for reform in two key areas:
1. Lower the total amount of losses that insurers must bear before drawing money paid into the Cat Fund.
2. Allow benefits to flow from the Cat Fund based upon a single-season calculation (deductible) versus requiring per-storm losses.
“Simply put, the larger the role of the Cat Fund in helping to pay hurricane losses, the larger the savings for consumers,” said Grawe. “And consumers support these changes. Over 78% of Floridians said they would definitely consider changes to the Cat Fund if it would mean savings on their homeowners policies.”
Visit http://www.helpFloridahomeowners.org for more information.
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