Representative Don Brown Announces Policy Recommendations for Property Insurance

Florida House Representative Don Brown today released his policy recommendations based on hearings held by the House Insurance Committee on March 14th and March 24th.

The House Insurance Committee took testimony under oath given by officials from Citizens Property Insurance Corporation and the Florida Office of Insurance Regulation. The hearing was set to explore the issue of assessments and determine the potential risk to taxpayers and the State, should insurance assessments be levied in the wake of a major hurricane or multi-storm season.

A copy of Representative Brown’s press release announcing his recommendations based on the hearing’s findings is reprinted below.

The full letter Representative Brown sent to House leadership is also attached for your review.

Should you have any questions or comments, please do not hesitate to contact this office.

Committee on Insurance Findings Reveal Dark Truths Floridians on the hook for billions of dollars of insurance assessments

Tallahassee – State Representative Don Brown (R-DeFuniak Springs) today released the House Committee on Insurance’s findings on the risk of assessments to Florida taxpayers in the event of a catastrophic storm. The Committee’s findings and recommendations were released in a letter to House Speaker Marco Rubio.

On March 14th and March 24th, the House Committee on Insurance heard testimony from officials with Citizens Property Insurance Corporation and the Office of Insurance Regulation. The Committee, which took testimony under oath, met to specifically explore the issue of assessments and determine the potential risk to taxpayers and the State should insurance assessments be levied following a major hurricane or multi-storm season.

Among the Committee’s key findings:

• If a 1-in-100 year storm hits Florida, assessments by Citizens would total over $10 billion and could be levied on Florida citizens and businesses for up to 30 years;
• Since January 2007, insurance rates charted by Citizens have been actuarially inadequate;
• In the event of a hurricane or series of hurricanes, the CAT Fund could have extreme difficulty paying its obligations;
• If the CAT Fund is unable to meet its financial obligations, many policyholders could experience delays or may not be paid for all their hurricane-related claims.
• Florida’s property insurance market is not healthy as evidenced by the large size of Citizens Property Insurance Corporation (a residual market).

“Our two days of testimony proved to be very enlightening,” said Representative Don Brown. “Should a storm hit, the taxpayers of this state could be on the hook for $35 billion or more in assessments.

Furthermore, hundreds of millions of dollars in storm claims could go unpaid for some time. We have created a legal and regulatory system that stifles the private market and jeopardizes the financial health of our citizens and State. We must take action now to prevent that from happening.”