Fast Focus
	Florida’s approach to catastrophes is to use unrated or poorly rated carriers, raising questions about how much protection there really is.
	Every person and business with a Florida auto or property policy will be on the hook—unless the feds come to the rescue.

Committing Insurance Without a License

WHAT? ME WORRY? Florida's hurricane insurance reforms mean every Florida insurance consumer may be buried under surcharges piled atop surcharges--all to create cheap rates today. Some see a federal bailout in the offing.

By  Cheryl Arvidson

[Page 2 of 8]

Whoa, Nellie!

Thirty years? Even for people who didn’t insure with Citizens? And here’s the final move of the shell. If there is another hurricane this season or the following year or years, that whole cycle would start again, with assessments on top of assessments.

Suddenly, the short-term gain of those unrealistic insurance premiums doesn’t seem quite as attractive.

Can lawmakers really believe that Florida residents will tolerate assessments of this sort—an estimated $600 annually per policy for 30 years in the event of a Category 3 or stronger storm—and not rise up in revolt?

Ross thinks his legislative colleagues believe they will never be held accountable because the federal government will step in to head off the assessment disaster.

“I think that politically, my colleagues look at it and think that the Feds will come in because that’s what they did in Katrina. And I think politically, the Feds will come in. But what have we done? We haven‘t taken a responsible approach to insuring this risk in the most responsible way and that is with private capital,” says Ross.

So far, the dice roll is working because, in addition to the fact that there have been no hurricanes, very few Floridians are aware they’re on the hook. A recent survey by the Property and Casualty Insurers Association of America found that 71% of Floridians do not know the legislative changes allow Citizens and the Cat Fund to assess virtually all insurance policyholders in the state if there is a financial shortfall.

“It is deeply concerning that the vast majority of Floridians are completely unaware of the reason they face this potential assessment,” said Rep. Don Brown, R-DeFuniak Springs, in a recent letter to Florida House Speaker Marco Rubio. Brown is the other lawmaker who voted no on the insurance package.

“This suggests,” says Ross, “that Floridians are also unaware of the reason why these ‘hurricane taxes’ exist. One major storm and the taxpayers of the state will be hit with assessment.”

In fact, policyholders are already paying three assessments from Citizens, the Cat Fund and the Florida Insurance Guaranty Association.