Comprehensive property insurance legislation moving to the floors of both the Florida House and Senate next week need further improvement, according to the American Insurance Association. The legislation, which moved out of committee Thursday, was introduced in the aftermath of last year’s four major Florida hurricanes.
“Early versions of bills in both the House and Senate mirrored recommendations of the Legislature’s Joint Select Committee on Hurricane Issues that – if implemented – would have caused tremendous instability in the Florida property market,” Cecil Pearce, AIA vice president, Southeast Region said. “Working with the chairmen of the House and Senate Insurance Committees we have been successful in eliminating or limiting the scope of several harmful provisions. We now have bills going to the floor next week that are much less onerous, but that we will continue to working to improve.”
SB 1488, HB 1745 and HB 1937 all seek to address perceived shortcomings in the Florida property insurance market in the aftermath of the unprecedented 2004 hurricane season. The bills reflect an attempt by policymakers to focus on measures that will keep insurers writing property insurance in Florida, while simultaneously responding to consumer concerns regarding price, availability and understanding of homeowners insurance.
“Legislators have included positive initiatives in these measures, such as lowering the Florida Hurricane Catastrophe Fund retention level. They also are addressing multiple storms in one season, providing a solution to last year’s Mierzwa court decision regarding the valued policy law, and reforming the sinkhole claims process,” Pearce said. “But other provisions of the bills will be detrimental to insurers’ ability to manage risk in a responsible manner, and thus harm consumers in the long run.
“These include giving regulators the authority to disapprove forms, eliminating arbitration, requiring insurer disclosure of hurricane model data to regulators, and instituting a 30-day time limit for completing certain claims activities,” he said. We will continue to deliver the message over the next two weeks that insurers need a stable, predictable regulatory environment in which to operate, and that market stability will benefit consumers and insurers alike.”
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