Florida Legislature’s Office of Program Policy Analysis & Government Accountability (OPPAGA): Steps Could Be Taken to Reduce the Public Hurricane Loss Projection Model’s Reliance on State Funding, Report No. 11-25 December 2011
Dec 29, 2011
The Florida Legislature’s Office of Program Policy Analysis & Government Accountability (OPPAGA) issued Report No. 11-25 in December 2011, entitled “Steps Could Be Taken to Reduce the Public Hurricane Loss Projection Model’s Reliance on State Funding.”
A summary of the report is provided below, along with hyperlinks to the report and related material.
The Florida Office of Insurance Regulation (“OIR”) is the Florida Public Hurricane Loss Projection Model’s (“Model’s”) primary user.
The Model, which was developed by Florida International University (“FIU”) and its partners, provides the OIR with an independent benchmark tool for reviewing the reasonableness of rates proposed in insurer filings.
The Model’s operation and maintenance is supported primarily by public/state funds. In Fiscal Year 2010-2011, FIU received $588,409 from the OIR, most of which is used to support the Model’s routine operation and maintenance.
During the same period, 12 private insurers paid FIU a total of $129,338 to use the Model. These fees only covered the cost associated with providing requested services. The direct expenditures for operating, maintaining and updating the Model were $723,937 in Fiscal Year 2010-11.
According to the report, to further increase private funding for the Model, FIU could market or enhance it to make it more useful to private insurers. In relation to Model financing, the Florida Legislature could also consider several options, including discontinuation of state funding, the reduction of state funding as it is offset by increasing fees paid by insurers, or simply opt to continue the current funding arrangement.
To access the full report in PDF format, click here.
To view the Model-related presentation to the Florida Senate Subcommittee on General Government Appropriations from December 8, 2011, click here.
Should you have any questions or comments, please contact Colodny Fass.