Florida property owners can expect big insurance rate hikes in the wake of a bill passed in the last few minutes of the annual legislative session, but they won’t go up as much as they could have if the bill had not passed.
The reform plan is supposed to keep the state’s private insurance market viable and Citizens Property Insurance Corporation afloat.
Under the insurance reform bill, homeowners are still faced with a 2.5 percent assessment this year to pay down the Citizens Property Insurance Corporation’s $1.7 billion deficit. The rest of that deficit would be paid off over 10 years if Jeb Bush signs the bill into law.
With another hurricane season just weeks away, the Legislature voted to pump $715 million into the state-run Citizens Property Insurance Corporation to save us from what would otherwise have been a 20 percent assessment on every homeowner.
It also kicks seasonal residents out of the Citizens pool next year, and million dollar homes out in 2008.
Sam Miller with the Florida Insurance Council called the legislation historic. He especially likes a new plan to help mitigate storm damage.
“When it’s up and running, every homeowner can get a free inspection, find out what you can do to make your home more likely to survive a hurricane, reduce your insurance rates because we have to offer discounts.”
Even though this effort to solve Florida’s insurance crisis has now dominated the last two legislative sessions, nobody here believes the problems are resolved yet.
Property owners can still expect a 15 to 20 percent rate hike from their private insurance companies in the months ahead, but Jeb Bush called the legislation a good first step.
“Good effort to provide some support for people who are going to see their premiums go up, and also to reform our system, so that in five year from now, we don’t have one insurance company, which would be Citizens.”
Bottom line, you can count on your premiums going up, but at least you’ll be able to get insurance.