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Bill allowing hefty Citizens insurance rate hikes clears first panel
By Julie Patel March 29, 2011 04:25 PM
A bill that would raise Citizens Property Insurance policyholders’ premiums by up to 25 percent a year and make many policyholders ineligible for coverage was approved by a close 6 to 4 vote in the Senate’s insurance committee today.
Sen. Alan Hays, R-Umatilla, said his bill, SB 1714 is aimed to shrink state-backed Citizens, Florida’s largest residential insurance provider with 1.3 million policies, and even the playing for private insurers. The bill will go to one ore two committees before it can be taken up for a full Senate vote.
The bill, and its House companion, HB 1243, would also bar policies for homeowners who find coverage elsewhere for a price that’s up to 25 percent more; require Citizens to drop policies covering homes that cost at least $500,000; prevent Citizens policyholders from hiring public insurance adjusters to represent them in claims disputes; and require Citizens to hire an outside consultant to analyze whether to have more of its work outsourced.
Gwen Margolis, D-Miami, said people who will be no longer be eligible for coverage with Citizens will find it even harder to sell their homes, which could worsen economic problems in the state.
“At what point do we recognize that there are people out there that are struggling that can no longer afford [it]?” said Sen. Mike Fasano, R-New Port Richey, who led the charge against the bill. He said Floridians who elected Republicans do not expect legislators to raise their taxes, rates or premiums. “Every time I turn around we see another rate increase…Give these people some relief.”
Hays said his bill would help reduce fees charged to the 85 percent of Florida policyholders who don’t have Citizens but have to help offset the insurer’s deficits from the 2005 hurricanes. “We call it an assessment but that’s just a big long word for tax,” he said.
J.D. Alexander, R-Lake Wales, said auto insurance policyholders would also be subject to paying fees. He said a constituent told him, “I can’t even afford a house. Why do I have to pay this assessment?”
South Florida lawmakers that voted against the bill are Sens. Margolis, Chris Smith, D-Fort Lauderdale, and Eleanor Sobel, D-Hollywood. Sen. Joe Negron, R-Stuart, voted for it, Sen. Ellyn Bogdanoff, R-Fort Lauderdale, was not at the meeting.
To weigh in, find your legislators and contact information for them online.
Categories: Citizens Property Insurance (19), Property Insurance (306)