Florida’s chief financial officer says the state’s insurance market is headed for a meltdown unless lawmakers put some tough new reforms in place.
Tom Gallagher says his proposals will help keep insurers from leaving the state and rein in skyrocketing premiums. It looks like insurance reform will once again dominate the coming legislative session.
The eight hurricanes Florida’s endured since August of 2004 have cost more than $32 billion in insured losses, sending insurance premiums through the roof and some insurance companies packing.
Chief Financial Officer Tom Gallagher oversees the office of Insurance Regulation and says, “The past two years have proven that storms will strike anywhere in Florida.”
He’s pushing a major reform effort aimed at keeping insurance available and affordable. Proposals include extending tough state building codes to the panhandle, limiting citizens’ insurance coverage of luxury homes to a million dollars, earmarking sales tax revenue from hurricane-related activity to pay citizens assessments, and extending the state’s mediation program to include condo associations.
Gallagher is running for governor, and skeptics might question whether his insurance proposals are true reform, or just campaign rhetoric.
Democratic lawmakers have rolled out similar reform proposals for the coming session. But Representative Priscilla Taylor says she’s not as worried about who gets the credit. She just wants the problem solved.
“It’s important for the citizens of Florida, regardless of whether you are Democrat or Republican or whatever, we don’t care, we’re all in this together.”
For his part, Gallagher says the insurance crisis is bigger than politics.
“We need to make sure we have a market for people. Without that market, we don’t have an economy in Florida.”
In the wake of double and even triple digit increases for homeowner’s insurance premiums, lawmakers will be under even more pressure to get a plan in place that works.
State CFO Tom Gallagher is also pledging to work with the feds to create tax-free catastrophe savings accounts. The accounts would let you sock away money tax-free to pay insurance deductibles and other storm-related costs.