As the Florida Legislature attempts to rein in “runaway litigation” against property insurers, proposals within the proposed legislation will negatively impact residents of Monroe County. FIRM and the Monroe County legislative team have shared their concerns with Sen. Ana Maria Rodriguez and Rep. Mooney.
HB305 – Removal of Citizens 10% rate cap and cost to consumers for reinsurance, whether purchased by Citizens or not. At the Citizens rate hearing last month before the Office of Insurance Regulation (OIR), the Citizens Board of Governors recommended removal of the rate cap with a specific request to exemp Monroe County. HB305 disregards that request and overlooks the fact that Citizens is the insurer of last resort for many in Monroe County. Rate increases with no cap would add further burden to homeowners and trickle down into all aspects of our economy. The bill also directs Citizens to include the cost of reinsurance–insurance that a carrier purchases to protect its assets in case of a major claim event–in its rate calculations, even if it doesn’t purchase the reinsurance.
SB76 – Roof reimbursement schedule–reduced coverage for policyholders. This companion bill to HB305 would leave Florida policyholders picking up the tab for what property insurance should cover. If this bill passes, homeowners with roofs 10+ years or older could lose coverage, have to pay out of pocket for repairs, or be forced to get a brand new roof. This proposal is not included in HB305, so we are hopeful that it will not pass.
SB1574 – Removal of rate cap specifically targeting policies in Monroe County and inclusion of surplus lines carriers. This bill removes the rate cap on policies with more than $700,000 in coverage. A 2013 bill reduced Citizens coverage from $1 million to $700k except for Monroe County, where the OIR determined there is no reasonable degree of competition. So not only does this this punitive piece of legislation not exempt Monroe County but it targets policyholders in Monroe County only –policyholders that are already paying the highest rates in the state. This bill also allows so-called surplus line carriers to participate in the market in the same way as authorized insurers. Surplus lines insurers are not subject to rate or form approval by the OIR nor are they covered by the Florida Insurance Guaranty Association.
During the period from 2003-2020 Monroe County has had in-force premiums of $1.3 billion and losses of $4.9 million, generating a loss ration of 37.25%. The gross annual profit that Monroe County has paid to Citizens is over $44 million for the last 17 years.