As Special Session Nears, Florida Chamber Urges More Property Insurance Reforms

Florida is within the midst of a swirling storm with a property insurance coverage market that has been described as in free fall.

In late August, we marked the thirtieth anniversary of Category 5 Hurricane Andrew making landfall in South Florida. At the time, Andrew was the most expensive pure catastrophe in U.S. historical past. More lately, elements of Florida had been decimated by Hurricane Ian, a robust Category 4 hurricane that can be a part of the ranks of costliest Atlantic hurricanes and, sadly, one of many deadliest hurricanes to ever strike Florida.

Simply put, Hurricane Ian is a disaster on high of a disaster.

As Floridians, we all know it’s not if there’s a hurricane, however when. This season, like each hurricane season, we should do our half to organize, to harden our properties and companies to mitigate potential injury, and plan for the worst outcomes. Catastrophic storms not solely deliver devastation and struggling to these impacted, however drive up charges customers should pay and, of late, have solely intensified our artifical property insurance coverage disaster. In 2021, Florida generated 7.03% of property insurance coverage claims nationwide however was accountable for 76.32% of the nation’s home-owner insurance coverage lawsuits filed. These numbers are particularly alarming contemplating that till Hurricane Ian, Florida had not had a significant storm hit our coast since 2018.

Unfortunately, attributable to our bottom-five authorized local weather (based on the FloridaScoreCard.org, compiled by the Chamber Foundation’s Community Development Partnership Council) the driving pointless litigation and fraud, Florida’s property insurance coverage charges have skyrocketed to a few occasions the nationwide common. Additionally, non-catastrophic claims and the motivation to litigate have led to many property insurers going out of enterprise or lowering their protection in Florida. Recently, Citizens Property Insurance Corp., the taxpayer funded “insurer of last resort,” reached greater than 1 million insurance policies, placing all taxpayers liable to a large “hurricane tax” if a significant storm exhausts their reserves. Prior to Hurricane Ian making landfall final week, Citizens president and CEO Barry Gilway had bluntly said “the industry is on life support.”

To handle this disaster, Gov. Ron DeSantis properly referred to as a particular legislative session that convened in May. The reforms that handed are a major step ahead, however like earlier efforts to repair the market, the trial attorneys and fraudsters struggle to remain a step forward of policymakers and reforms, so we’ve way more work to do.

We must stabilize the market by proscribing fraud and abuse by dangerous actors and eliminating the motivation to over-litigate. We must create competitors out there by welcoming new capital and addressing Citizens Property Insurance’s below-market, taxpayer-subsidized charges. The final aim is to cut back insurance coverage premiums for hard-working Floridians and defend Florida taxpayers.

Named storms straight hitting our coast exacerbate our artifical insurance coverage disaster and take a look at the bounds of our struggling property insurance coverage market. In addition to the destruction of properties, companies and lives, claims from injury attributable to a hurricane result in elevated premiums and doable sudden funds by taxpayers by means of “hurricane taxes,” larger payouts by insurance coverage corporations, extra litigation, and conceivably much more insurers unable to keep up their presence in Florida. This in the end decreases competitors and capital in Florida, furthering the disaster the insurance coverage market is in.

As we start the lengthy street to get well from this storm and encourage Floridians to do their half in getting ready for the following one, it’s important policymakers start contemplating extra reforms to stabilize Florida’s property insurance coverage market, incentivize insurance coverage capital coming to Florida, and instantly enhance our bottom-five authorized local weather.

Mark Wilson is president and CEO of the Florida Chamber of Commerce. This viewpoint was reprinted with permission from the Florida Chamber. It beforehand ran within the Orlando Sentinel. The Chamber will host a property insurance coverage summit Dec. 5-7 in Orlando.

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Florida
Property