Insurance Companies Post Large Profits as Lawmakers Head for a Showdown

By: Victoria Langley
By: Victoria Langley

The nation’s insurance companies are posting a $59 billion profit for 2006, just as the industry and Florida lawmakers are heading for a showdown at the Capitol.

The special legislative session to tackle the state’s insurance crisis starts in less than two weeks, and there’s likely to be even more pressure now for lawmakers to take action to bring down sky-high rates.

After two years of crushing storm damage, the insurance industry finally had a very profitable year in 2006 with $59 billion dollars in profits.

A conference call with industry execs confirmed 2006 was a good year financially, including a nearly $3 billion profit for insurance companies in Florida alone.

Spokesman Sam Miller says he hopes people understand you want your insurance company to make money.

“The year we want to work with the governor. When we make money it enables us to have money set aside to pay the claims during the bad years.”

But with lawmakers in special session later this month, those record profits are going to put added pressure on to hold the insurance companies accountable.

Gov. Charlie Crist is pledging to push for lower rates in spite of industry pressure to back off the regulations.

Office of Insurance Regulation spokesman Bob Lotane says there probably won’t be much sympathy for companies that are pricing customers out of their homes, or dropping them all together.

“That’s alarming when they see Allstate yesterday announcing they’re going to be non-renewing another hundred thousand policies and yet they’ve made record profits.”

The balancing act for lawmakers will be providing relief for desperate homeowners without scaring off insurance business the state can’t live without.


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