Skyrocketing insurance premiums and cancelled policies were causing headaches even before the summer hurricanes. Now some Florida lawmakers have come up with what they call a common-sense list of reforms.
But Florida’s insurance industry says it’s a tough time to be putting a bunch of new rules in place.
Barbara Katz has watched her homeowners insurance rates go up, up, up over the past two years, even before the summer of storms hit Florida.
“My insurance bill has increased on my homeowners at least 50 percent. It’s gone from $1600 to $2400.”
And she’s not alone. State Senator Ron Klein says thanks to the hurricanes, skyrocketing premiums and cancellations are not just a South Florida problem anymore.
“It’s going to be in all 67 counties. All over Florida counties are going to be impacted because at some point the insurance companies will take the position that the entire state is under the threat of a hurricane in the future.”
Klein and other legislators are now proposing a number of reforms. Among them, policies would have to be written in plain English so customers would know what’s covered and what isn’t. Customers would get a discount for hurricane-proofing their homes, and companies couldn’t cancel you if you’ve been a customer and paid your premiums for at least five years.
The recommendations lawmakers will consider may seem like common-sense, but the insurance industry is already gearing up for a fight. Insurers say the last thing they need right now is even more regulation.
“What we need to have is a careful balance of protecting consumers but yet not tying the hands of insurance companies so we can’t bring down the billions of dollars in new capital that we have to have for the 2005 hurricane season. “
But homeowners like Barbara Katz fear 2005 will only bring higher rates and more cancellations unless lawmakers start worrying less about the industry and more about its customers.
Due to last summer’s unprecedented hurricane season, insurance reform is sure to be one of the hot-button issues in the legislative session that starts in March.