State officials approve plan to shore up CAT fund

Jul 3, 2008

Palm Beach Post--July 2, 2008

TALLAHASSEE, Fla. — Florida residents might see an increase in property insurance rates because of a plan to bolster the Florida Hurricane Catastrophe Fund.

State officials on Wednesday approved a plan to spend $224 million so that the state can access the $4 billion it might need if a major hurricane hits Florida in the coming months. Under the proposal that was approved, property insurance rates might increase 2.5 percent.

Officials were concerned that if the Florida was hit with a major hurricane, the Florida Hurricane Catastrophe Fund — known as the CAT fund — could have difficulty borrowing the money needed to pay insurers.

Attorney General Bill McCollum and Chief Financial Officer Alex Sink each voted for the plan, but both said they didn’t like its terms.