Hurricane Ian damage. Flickr

FL - 'Hope' won't fix Florida's property insurance crisis

If you thought the original was disappointing, the sequel provided more of the same. Last week's special session of the Florida Legislature marked the second attempt this year by Gov. Ron DeSantis and state lawmakers to address the property insurance crisis.

The first one produced changes that favored the insurance industry; this one's no different.

What came out of last week's three-day special session were bills that continue to put the burden of propping up a faltering industry that is key to the state's all-important real estate market squarely on the backs of homeowners. Floridians already pay an average of $4, 231, up from $1, 988 in 2019, according to an Insurance Information Institute analysis. That price will probably continue to grow, despite the new legislative fix.

Private insurance firms will receive $1 billion from state coffers to cover the reinsurance they buy as a backstop to help pay claims. Policyholders will find it more difficult to legally challenge any offers property insurers may give in response to claims. If you believe you'll get a break through Citizens Property Insurance Corp., think again. The legislation makes it easier for the state to force policyholders out of lower-cost Citizens coverage and onto policies from higher-priced private carriers.

"I don't like that. Floridians don't like that," House Speaker Paul Renneracknowledged at a press conference. "But we're in a very bad spot."

Granted, fixing Florida's property insurance market is, well, daunting. Litigation has been a problem for an industry that has paid billions in claims. The cost of reinsurance makes it difficult for firms to operate here, and the fact that the market is dominated by so many smaller, private insurers with increasing risks is problematic, too. Florida also can't continue with Citizens Property, the state-backed insurance carrier that is supposedly "the insurer of last resort."

The plan the Legislature produced had an air of desperation. "Long-term?" asked State Rep. Tom Leek, R-Ormond Beach, who sponsored the bill. "There is hope and a plan."

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