A draft proposal was leaked last week that reflected some Florida legislators' attempts to modify the property insurance landscape in Florida. This proposal is essentially the insurance companies' proposal. Toluse Olorunnipa, of Tampa Bay Times, had a very good summary of the bill in his article last week.
According to the article, the proposed legislation includes the following:
- Citizens must charge rates that are higher than average rates in the private market
- Insurance companies may use an "insurance inflation factor" to raise premiums faster than currently allowed by law
- Insurance companies, including Citizens, may charge homeowners additional fees to help cocver the cost of backup insurance
- Insurance companies can charge rates that are higher than what regulators traditionally allow, if homeowners agree to the higher charges.
Opponents of the bill include Representative Mike Fasano, who stated, "I would never support that proposal. I feel confident that those senators will step up to the plate and stop any further rate hikes."
The idea that Citizens is having tough financial times is hard to believe. As of the fall of 2012, Citizens had enough of a surplus (over $6 billion), that plans to entice private companies back to the property insurance market were floated with the idea that potentially forgiveable loans (handouts) to private insurance companies would be made from this surplus at Citizens.