Based on the fact that he’s already turned to the federal government for a catastrophe backstop, it’s not surprising that he expects companies to factor in profits from other states into their Florida rates. I wonder if he will allow companies to increase their Florida rates based on underwriting losses in other states. After all, just as pro-Crist Floridians expect other states to subsidize their rates, I’m sure they can’t wait to reciprocate.
One way or another Crist adn the rest of the state is going to make everyone subsidize their insurance premiums… that is until we can get rid of what we have left in the state.
Please read Bill’s post carefully as it makes a very key point. If Florida property carriers are expected to consider national profits in setting Florida property rates, then they should also be allowed to consider national losses even if Florida property results are (by some miracle) profitable. In that situation, I am certain the FL OIR will give a carrier’s Massachusett’s Automobile results equal consideration under this law. Isn’t that what the Governor is intending? Or is he admitting that companies will never be able to make a profit in Florida given the legislation he has pushed through?
My policyholders in Washington will be glad to pay more because of Florida. And to think after fifteen years of agency I finally convinced them that their rates are NOT affected by what goes on in Florida. Wait till I tell them a governer they have never even heard of raised their rates!!! Isn’t Crist a Republican? What happened to states’ autonomy? No honor.
The return on Florida Homeowners from 1990-2006 was -38.1% and the Governor won’t support risk-based pricing. Roping in national results to subsidize Florida residents is one of the few options remaining.
I wonder how other states will feel when carriers restrict capacity in non exposed areas and/or try to include a load for their Florida property results?
This is simple cost-shifting. It’s more pragmatic for the Governor to continue to blame the industry and shift costs than it is to require mitigation or restrict construction.
Gov is passing cat losses on to all FL residents – not just prop owners. Some believe real rate for $200,000 home should be $18,000+ assuming a 1 in 5 yr hurricane. Collapse of the FL prop mkt is coming. Fixed income people can’t afford the real rate so they will leave – future retirees will go elsewhere. Rates s/b market driven!! Not Gov driven!!!
For the first time, more people left FL than moved into FL. Perhaps the people who pull Crist’s strings realize that tax and insurance cost were the primary cause given by those leaving the state. Developers pull Crist’s strings. This gives them a chance to unload their property… even if it bankrupts the entire state. All of Crist’s actions are because of money… not from poor people action groups… follow the money… who paid to get Crist elected?
These actions hurt everyone. Insurance Companies will restrict their activity in FL. The question becomes can FL survive 2007 and 2008 storms? Get out while you can. One more multi-billion dollar storm will send a message to all investors… they no longer can insure their investment in FL… Crist made it a gamble rather than risk management.
In Crist’s defense (and I hate to try to defend him), this problem began years and years ago when the state began to allow the barrier islands to be developed. Not only did this eliminate a natural defense against storm surges, it also drastically increased the coastal exposure. Now instead of a hurricane tearing through mangroves, it tears through million dollar homes!
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Based on the fact that he’s already turned to the federal government for a catastrophe backstop, it’s not surprising that he expects companies to factor in profits from other states into their Florida rates. I wonder if he will allow companies to increase their Florida rates based on underwriting losses in other states. After all, just as pro-Crist Floridians expect other states to subsidize their rates, I’m sure they can’t wait to reciprocate.
Do I need to say more?
One way or another Crist adn the rest of the state is going to make everyone subsidize their insurance premiums… that is until we can get rid of what we have left in the state.
Please read Bill’s post carefully as it makes a very key point. If Florida property carriers are expected to consider national profits in setting Florida property rates, then they should also be allowed to consider national losses even if Florida property results are (by some miracle) profitable. In that situation, I am certain the FL OIR will give a carrier’s Massachusett’s Automobile results equal consideration under this law. Isn’t that what the Governor is intending? Or is he admitting that companies will never be able to make a profit in Florida given the legislation he has pushed through?
My policyholders in Washington will be glad to pay more because of Florida. And to think after fifteen years of agency I finally convinced them that their rates are NOT affected by what goes on in Florida. Wait till I tell them a governer they have never even heard of raised their rates!!! Isn’t Crist a Republican? What happened to states’ autonomy? No honor.
Pat, Very astute observation.
However I doubt seriously that this was the intent of the bill and as such the rule will be interpreted as the state intented it to be.
I can’t believe any company would want to remain and do business in Florida. They are nuts if they don’t leave quick.
the problem is, the Rest of Us will be expected to pick up the tab anyway, via taxes.
The return on Florida Homeowners from 1990-2006 was -38.1% and the Governor won’t support risk-based pricing. Roping in national results to subsidize Florida residents is one of the few options remaining.
I wonder how other states will feel when carriers restrict capacity in non exposed areas and/or try to include a load for their Florida property results?
This is simple cost-shifting. It’s more pragmatic for the Governor to continue to blame the industry and shift costs than it is to require mitigation or restrict construction.
Gov is passing cat losses on to all FL residents – not just prop owners. Some believe real rate for $200,000 home should be $18,000+ assuming a 1 in 5 yr hurricane. Collapse of the FL prop mkt is coming. Fixed income people can’t afford the real rate so they will leave – future retirees will go elsewhere. Rates s/b market driven!! Not Gov driven!!!
For the first time, more people left FL than moved into FL. Perhaps the people who pull Crist’s strings realize that tax and insurance cost were the primary cause given by those leaving the state. Developers pull Crist’s strings. This gives them a chance to unload their property… even if it bankrupts the entire state. All of Crist’s actions are because of money… not from poor people action groups… follow the money… who paid to get Crist elected?
These actions hurt everyone. Insurance Companies will restrict their activity in FL. The question becomes can FL survive 2007 and 2008 storms? Get out while you can. One more multi-billion dollar storm will send a message to all investors… they no longer can insure their investment in FL… Crist made it a gamble rather than risk management.
In Crist’s defense (and I hate to try to defend him), this problem began years and years ago when the state began to allow the barrier islands to be developed. Not only did this eliminate a natural defense against storm surges, it also drastically increased the coastal exposure. Now instead of a hurricane tearing through mangroves, it tears through million dollar homes!
And guess what… they are continuing to build.