Mr. Bishop should know that Citizens is already over extended with their current wind-only exposure. What I believe he\’s missing here, is that by allowing Citizens to compete for the gravy portion of the business out there, they just might be able to turn a profit in at least one area of their portfolio. Allowing them to expand thier business into select risk exposures will be an improvement over their current insurer of last resort position. Until now, Citizens could only attract misfit business. Properties that others find unacceptable, either because of age or condition or prior claims history. By allowing them to compete for the newer constructed, better constructed, better credit insured\’s, they dramitically improve their position.
Peter A must work as a spin doctor for Crist, Roger Looyenga, Chairman/CEO for Auto-Owners reviewed the January legislative package and Cliff Notes version is: They will not do business with unstable reinsurer (Florida -$1.35 Bill in debt) and secondly ALL policies in Florida, except life , WC, and Med Malpractice are now assessable (not just property), and a bad year could amount to 42% of assessments for their policyholders. Citizens has never turned positive cash flow much less a profit, why let them delve into another area with no experience and keep private carriers from re-entering the market.
Let\’s face it. The problem isn\’t whether Citizens can turn a profit. It\’s no-one can afford to pay the bill in the event of a major Hurricane. So with that said, the solution seems clear and addressable. Let Citizens write the Wind Only portion of the property risks statewide. Then, the property market will stabilize, and the risk of catastrophic loss is placed squarly in the hands of the state. They can run up a tremendous CAT fund and use it to pay Hurricance Claims, or issue bonds until the cows come home while the rest of the insurance marketplace settles out without the CAT risk. Put the hot potato in the hands of Citizens and leave the rest of the insurance market to the insurance companies. Can\’t understand why this is such a difficult solution to work out. Can you imagine the insurance companies complaining if the wind risk is removed from all their policies? If the state wants to be in the insurance business, give them the risk that no-one wants.
We are from the Government and we are here to help! Can anyone anywhere remember when the Government (state or federal) has taken over a service or business and it has gotten better.
MORONS! Florida is a 90 mile wide island. If you want to live on an island, you have to pay the associated risk cost i.e. insurance premiums
Please correct me if I am wrong, but isn\’t Citizen loosing money? Do they have the money and intellectual resources to handle more business? I am with State Farm and had to pay an extra charge that went staight to Citizens. What kind of economics is this? A taxpayer subsidized non profit company looking to buy things it can\’t handle…I don\’t get it.
Mary your absolutely right. Citizens gets to assess everyone\’s policy for it\’s shortfall. That\’s why your company (State Farm) would drop you like a hot potato if the State would let them. They don\’t want to compete in this market either. It\’s a mess and expanding Citizens is NOT a solution, it\’s like treating the symptoms, not the cause of a sickness. Reducing Citizens to handle ONLY the wind portion of the property insurance coverage for everybody is an answer. Not unlike California\’s answer to earthquake coverage (it\’s purchased directly from the State there) it would initially be expensive, but the costs would lower over time (assuming that we don\’t have any Hurricanes for a few years) after the State claim fund is reestablished to pre-2004/2005 Hurricane loss levels.
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Mr. Bishop should know that Citizens is already over extended with their current wind-only exposure. What I believe he\’s missing here, is that by allowing Citizens to compete for the gravy portion of the business out there, they just might be able to turn a profit in at least one area of their portfolio. Allowing them to expand thier business into select risk exposures will be an improvement over their current insurer of last resort position. Until now, Citizens could only attract misfit business. Properties that others find unacceptable, either because of age or condition or prior claims history. By allowing them to compete for the newer constructed, better constructed, better credit insured\’s, they dramitically improve their position.
Peter A must work as a spin doctor for Crist, Roger Looyenga, Chairman/CEO for Auto-Owners reviewed the January legislative package and Cliff Notes version is: They will not do business with unstable reinsurer (Florida -$1.35 Bill in debt) and secondly ALL policies in Florida, except life , WC, and Med Malpractice are now assessable (not just property), and a bad year could amount to 42% of assessments for their policyholders. Citizens has never turned positive cash flow much less a profit, why let them delve into another area with no experience and keep private carriers from re-entering the market.
Let\’s face it. The problem isn\’t whether Citizens can turn a profit. It\’s no-one can afford to pay the bill in the event of a major Hurricane. So with that said, the solution seems clear and addressable. Let Citizens write the Wind Only portion of the property risks statewide. Then, the property market will stabilize, and the risk of catastrophic loss is placed squarly in the hands of the state. They can run up a tremendous CAT fund and use it to pay Hurricance Claims, or issue bonds until the cows come home while the rest of the insurance marketplace settles out without the CAT risk. Put the hot potato in the hands of Citizens and leave the rest of the insurance market to the insurance companies. Can\’t understand why this is such a difficult solution to work out. Can you imagine the insurance companies complaining if the wind risk is removed from all their policies? If the state wants to be in the insurance business, give them the risk that no-one wants.
We are from the Government and we are here to help! Can anyone anywhere remember when the Government (state or federal) has taken over a service or business and it has gotten better.
MORONS! Florida is a 90 mile wide island. If you want to live on an island, you have to pay the associated risk cost i.e. insurance premiums
Please correct me if I am wrong, but isn\’t Citizen loosing money? Do they have the money and intellectual resources to handle more business? I am with State Farm and had to pay an extra charge that went staight to Citizens. What kind of economics is this? A taxpayer subsidized non profit company looking to buy things it can\’t handle…I don\’t get it.
Mary your absolutely right. Citizens gets to assess everyone\’s policy for it\’s shortfall. That\’s why your company (State Farm) would drop you like a hot potato if the State would let them. They don\’t want to compete in this market either. It\’s a mess and expanding Citizens is NOT a solution, it\’s like treating the symptoms, not the cause of a sickness. Reducing Citizens to handle ONLY the wind portion of the property insurance coverage for everybody is an answer. Not unlike California\’s answer to earthquake coverage (it\’s purchased directly from the State there) it would initially be expensive, but the costs would lower over time (assuming that we don\’t have any Hurricanes for a few years) after the State claim fund is reestablished to pre-2004/2005 Hurricane loss levels.