| The Florida home insurance crisis is still alive and | | | | Presently, both the Florida Hurricane Catastrophe |
| well as Florida homeowners insurance companies | | | | Fund and Citizens Insurance Florida do not have |
| continue to leave the state and/or seek major | | | | enough money and are overly dependent on an |
| rate hikes. Both the companies and state | | | | unfriendly bond market to satisfy their |
| regulators can't agree on the appropriate amount | | | | responsibilities. Both organizations have to borrow |
| that homeowners should be paying to insure for | | | | before Florida hurricanes happen with limited |
| losses against major Florida hurricanes. | | | | success to come up with the money they need - |
| As a result, beginning in the 1990's, Florida started | | | | and they are coming up short in the bond |
| to impose special assessments on every Florida | | | | markets as the country continues to work |
| homeowners insurance policy issued and created | | | | through the financial crisis. |
| a state run insurance company of last resort that | | | | Citizens Property Insurance Corporation is the |
| is called Citizens Property Insurance Corporation | | | | organization that causes most of us to subsidize |
| to ensure that everyone in Florida can get home | | | | the Florida insurance costs of someone else. |
| insurance coverage for their home. | | | | Every one of us will be required to pay annual |
| Florida also created The Florida Hurricane | | | | special assessments for many years into the |
| Catastrophe Fund which requires all licensed Florida | | | | future to cover the cash shortfalls that Citizens |
| homeowners insurance companies to buy | | | | Property Insurance had as a result of the 2004 |
| reinsurance after the losses from a major | | | | 2005 storms. Cash shortfalls are just another |
| hurricane reach a certain level. This fund is | | | | way of saying that those who were insured with |
| insurance for Florida insurance companies and | | | | Citizens for the 2004/2005 storms, were simply |
| helps to make sure that they don't have to | | | | not charged enough premium for that coverage. |
| absorb all of the costs of a major hurricane | | | | Many of those homes are older homes that are |
| event. | | | | located in areas of Florida that are the most |
| Last but not least, Florida has an entity called the | | | | susceptible to hurricanes. After the Florida |
| Florida Insurance Guaranty Association (FIGA) | | | | hurricanes of 2004/2005, Florida legislators |
| that steps in to pay your claim up to a certain | | | | decided to freeze the home insurance rates being |
| level if your Florida home insurance company runs | | | | charged by Citizens - a politically popular decision |
| out of money and is declared insolvent. | | | | that also resulted in everyone in Florida subsidizing |
| Those special assessment line items on your | | | | the homeowner insurance rates of others who |
| Florida home insurance bill can cause you to pay | | | | live in the areas most vulnerable to hurricanes. |
| line item charges for many years into the future. | | | | Last but not least, because the rates of Citizens |
| You can be asked to make up the difference | | | | have been frozen for the past few years, even |
| when Citizens Property Insurance Corporation and | | | | when consumers can find Florida home insurance |
| the Florida Hurricane Catastrophe Fund don't have | | | | in the private market, they are still given the |
| the money to meet their obligations. Or you could | | | | choice of being insured by Citizens and being |
| be assessed for the difference if FIGA doesn't | | | | undercharged for their insurance. |
| have the cash to pay off the claims filed against | | | | This subsidized insurance that many Citizen |
| a Florida homeowners insurance company that | | | | policyholders receive, comes at a price. It is |
| became insolvent. | | | | funded mainly through special assessments that all |
| So far, at high level, each of these various entities | | | | of us are required to pay on our Florida |
| and the protections that they offer make sense. | | | | homeowners insurance bills each year. These |
| And when they work properly they do help | | | | assessments have become so burdensome, that |
| further diversify Florida's hurricane risk and help | | | | Florida home insurance policies are not enough to |
| make it attractive for Florida home insurance | | | | pay the total cost. That's why you'll see many of |
| companies to continue to do business in the state. | | | | them on your Florida auto and business insurance |
| However, the Florida Insurance Laws passed in | | | | bills as well. |
| 2007 and 2008 have altered and politicized the | | | | If you are fed up with paying the Florida |
| goals of each of these entities to a point where | | | | homeowners insurance premiums of someone |
| they no longer function as originally intended. | | | | else, now is the time to have your voice heard |
| Why? Because Florida legislators aren't willing to | | | | during the current session of the Florida |
| tell voters the truth - that these entities are now | | | | Legislature. Tell the lawmakers that you've voted |
| seriously underfunded and not positioned to do | | | | for and sent to Tallahassee that you want the |
| what they are supposed to do. Even worse, | | | | Florida home insurance rates of Citizens Property |
| many Florida consumers don't realize that they | | | | Insurance Corporation raised to reflect the true |
| are paying for someone else's Florida home | | | | cost of the homes they are covering. |
| insurance. | | | | |