More Insurance Problems

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Florida is looking to force three insurance companies into bankruptcy so the state can take them over. The property insurance industry is just a mess.

Citizen's has already cost taxpayers a multi-million-dollar payout.

Now Chief Financial Officer Tom Gallagher is calling for state control of three troubled providers, Southern Family, Atlantic Preferred, and Florida Preferred.

Ask most Florida residents, and they'll tell you the same thing.

Susan says in the middle of last year's hurricane season the good hands people dropped her policy.

Susan said. "Well, they transferred me to different carriers and now I'm with Citizens, which is the insurer of last resort, and again being in jeopardy of having that cancelled."

She's not the only one. After Katrina, insurance companies are not looking forward to protecting coastal properties. The affect is immediate. Real estate sales on the coast are dropping and realtors say it's time to step in before this becomes a real crisis.

Fred Gaupin with Century 21 said, "I think the state does have to move in and save insurance, hopefully for a short period of time."

Ted says this is just the first step.

"I just think it's a federal problem and it needs to be solved as a federal problem."

Congress looked into the matter briefly, but right now everyone's waiting for this hurricane season to see if the system will save itself or if more drastic measures are called for.

Gallagher wants the judge to issue a liquidation order. That would allow the state to tap into the Florida insurance fund to help pay claims.

Gallagher is turning to the courts for this because the companies themselves have not come up with a liquidation plan.