Florida Legislature
4:16 pm
Thu April 25, 2013

Florida Senate Passes Bill To Overhaul Citizens Insurance

Sen. David Simmons, R-Maitland
Credit flsenate.gov

UPDATE 4:36 p.m. - The Florida Senate passed SB 1770 today, 24-15.

Sen. David Simmons, R-Maitland, believes he has the votes to put his sweeping overhaul of Citizens Property Insurance Corp. up for a final vote in the Senate on Thursday.

Simmons was busy lobbying his colleagues over the proposal (SB 1770) during the floor session on Wednesday after the measure was postponed for the second time in nine days from being put up for a final Senate vote.

"I'm looking at probably 25, 26, 27," Simmons said during a lunch break on Wednesday while glancing through his own crib sheet on how he expects the state's 40 senators to vote.

"When people understand what I'm doing here," he continued, "and they understand that there exists these individuals who are getting an undue and unfair advantage – not of any fault of their own, they took the best deal available to them – the effect of it is a grossly unfair advantage that they have over everyone else with a grossly unfair burden placed on everyone else without Citizens policies."

Opposition remains from sinkhole rich areas around Tampa and in coastal Southeast Florida, both areas with large concentrations of Citizens' policies.

Simmons has been reworking a provision within his lengthy bill to reduce the rates that new property owners would have to pay when buying property covered by Citizens.

The change is intended to make the bill more palatable for lawmakers in districts with large numbers of Citizens policy holders who have expressed concerns that increasing rates could hinder the real estate market.

Under the latest proposal, buyers of homes now covered by Citizens would first enter a clearinghouse to determine if a private insurer is available to provide coverage that is within 15 percent of what Citizens requires.

If no private firm is available, the new policy holder would have to pay for a Citizens policy that is within 15 percent of the Citizens' rate.

A week ago, when the bill was first delayed, Simmons had proposed that the new policy holders be charged rates that are competitive with the top 20 private insurers selling in that market.

Because of concerns that have been raised in talks with his House counterpart, Rep. Bryan Nelson, R-Apopka, Simmons expects rates new homeowners entering Citizens may face could be lowered to 5 percent when the two chambers hammer out the final package.

The Citizens reform package also: creates an inspector general for personnel matters; the clearinghouse that is expected to drive 217,000 of the state-backed company's 1.3 million policies into private hands; makes the executive director a direct appointment by the governor and chief financial officer; retains a 10 percent cap on annual increases for current policy holders; renames the Florida Hurricane Catastrophe Fund Finance Corporation the State Board of Administration Finance Corporation; and reduces the maximum value of property that could be covered to $500,000 by January 1, 2019.

Gov. Rick Scott on Tuesday reiterated support for the inspector general, clearinghouse, and a provision that caps annual increases to current Citizens policies, but he wouldn't say if he will sign or veto the entire overhaul proposal.

"If you have Citizens, you should know your risk of a hurricane tax," Scott said. "Also we have got to make sure if you're a Citizens policy holder you should know you're going to get paid in case there is a storm."

(Reprinted with permission from News Service of Florida)