Kane Kaiman

FL - New legislation could soften island insurance market

Here’s some good news for shingle-payers.

Here’s some good news for shingle-payers.

Palmetto-based insurance broker Jim Cirillo said state legislation passed in May is “a step in the right direction” to softening a property insurance market that is “harder” than ever.

State legislators convened for a special session in May to hammer out remedial laws for the insurance crisis, a statewide supply-and-demand problem.

They passed Senate Bills 2D and 4D — sponsored by Sen. Jim Boyd, R-Bradenton, that would:

  • Authorize $2 billion for a reinsurance fund that carriers can access if they reduce customer premiums;
  • Forbid carriers from denying coverage based on a roof’s age if the roof is less than 15 years old or if an inspection shows an older roof has five or more years of viability;
  • Change state building code to permit homeowners to repair rather than replace roofs that are more than 25% damaged;
  • Discourages attorneys from pursuing frivolous lawsuits and Floridians from making unscrupulous roofing claims.

In recent years, global catastrophes, as well as lawsuits related to Hurricanes Irma and Michael, have drained the coffers of “reinsurance” outfits — entities that provide insurance for insurance companies.

The reinsurance shortage has forced many carriers out of business. Survivors have instituted more stringent underwriting policies related to the age of roofs and composition of buildings and many carriers have stopped writing policies for properties in high-risk areas, namely barrier islands.

To make matters worse, Citizens Property Insurance Corp., an entity that receives special reinsurance privileges from the state, tightened its underwriting guidelines, leaving many Floridians without an “insurer of last resort,” Cirillo said June 8.

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