Central FL Lawmaker Aims to Shrink State-Backed Property Insurance Rolls
April 26, 2013 | WMFE - Citizens Property Insurance, once the state's insurer of last resort, is now Florida's biggest property insurance company...but a Central Florida state senator's bill may change that. Lawmakers say Citizens' size is a problem because if a major storm hits, the state-backed company may not be able to cover all the claims, and could leave everyone in Florida with property insurance to pick up part of the tab.
[Image: Republican State Senator David Simmons of Altamonte Springs]
Senator David Simmons, a Republican from Altamonte Springs, says one of the biggest reasons Citizens Property Insurance might need the state’s help paying claims is because wind-only policy holders aren’t paying what their insurance costs. So, he has a plan to fix that.
“The way we solve this problem is number one, we say, ‘All right, for those of you who are in the wind-only account, guess what? You’re grandfathered and you’re grandmothered in. You can go ahead and continue on the way you are, getting the benefit that you’ve got,’” Simmons says.
However, he adds, people who make new purchases of property that needs wind coverage would be encouraged to seek private insurance. If they can’t find it, the state would insure them, but at what Simmons says is an actuarially sound rate.
Opponents worry what Simmons’ bill could mean for the state’s housing market, and say there are already plans in place to decrease Florida’s risk.
The measure passed out of the Senate 24 to 15.