Column: Florida Senator Michael S. Bennett says it’s time for a new insurance commissioner
Jan 24, 2011
Above: Florida Senator Mike Bennett
The following article was published in the Tallahassee Democrat on January 23, 2011:
It’s time for a new Insurance Commissioner
ABOUT THE AUTHOR:
Michael S. “Mike” Bennett, a Republican from Bradenton, represents District 21 (including parts of Charlotte, DeSoto, Lee, Manatee and Sarasota counties) in the Florida Senate and is the president pro tempore.
Contact him at email@example.com.
Floridians spoke decisively in November of their desire to reform government.
The election results were not only a rejection of the status quo and business as usual in Tallahassee, but also a strong affirmation of new ideas, new leadership and new faces. Since arriving in Tallahassee, our new Gov. Rick Scott and the statewide-elected Cabinet members have set Florida on a course to solve big problems with a bold set of new private-sector, job-creating solutions.
One of the most important steps Florida can take to improve the economy and stabilize the insurance market — and open up more choice for homeowners — would be for Gov. Scott and Chief Financial Officer Jeff Atwater to change leadership in the Office of Insurance Regulation. Just as new leadership is coming to most state agencies, it is arguably overdue for such change to come to the priority position of insurance commissioner.
The overregulation of Florida’s insurance market has created a climate in which companies such as State Farm are dropping policyholders and others have stopped writing new insurance policies altogether.
Recently, State Farm notified as many as 125,000 Floridians that they have been dropped and will no longer receive coverage.
For many Floridians, the only viable option is to turn to the staterun Citizens Property Insurance Corp., and the number of Floridians opting for Florida’s insurer of last resort is dramatically on the rise. The staterun insurance company has added more than 200,000 policyholders since last year and 100,000 in the last four months. At a time when Florida is facing a nearly $3 billion budget shortfall, adding policyholders to state rolls is simply not the answer. If Florida were to experience a natural disaster on the scale of a Category 5 hurricane, taxpayers would likely be forced to shoulder a bill in the hundreds of millions — or even billions — of dollars.
Floridians are looking for more affordable options to insure their homes and businesses instead of suffering the negative distinction of being forced to pay some of the highest insurance rates in the nation. According to a 2009 report by the National Association of Insurance Commissioners, Florida has the secondhighest homeowner’s insurance rates in the nation, with policies costing an average of $1,386. And, of course, for residents on or near our 1,000-miles coastline, the premiums are even more staggering. At a time when jobs are scarce and budgets are tight, expecting families to pay more for home insurance is simply unacceptable.
In Tallahassee, the buck stops with the Florida Office of Insurance Regulation, which has played politics with property insurance for too long. Since 2007, Florida’s property insurance rates have been driven by government requirements, not market forces.
The result has been a depleted insurance industry, fewer companies, higher rates and fewer choices for homeowners.
Florida’s newly elected officials have promised more accountability — and that must extend to those who regulate Florida’s insurance industry. It has been more than five years since a major hurricane has made landfall over Florida, and yet our insurance market is still struggling. Despite all of the rhetoric in Tallahassee and promises for change, Floridians yearn for more affordable home insurance options that do not increase the burden on taxpayers.
Gov. Scott and Chief Financial Officer Atwater should take swift action by forcing a change in leadership at the Office of Insurance Regulation. The state’s insurance office should protect the public interest better by being an active partner in economic development — not one of its obstacles. Indeed, when bureaucrats dig in deep and make holding onto power a higher priority than serving the people, taxpayers suffer.
The time has come for a change in the leadership at Florida’s top insurance office. In the spirit of the change Floridians brought to Tallahassee in this new year, homeowners deserve better: new ideas, new faces and a break from the status quo to make Florida’s insurance market competitive once again.