Without some guarantees from lawmakers, three in ten homeowners could find themselves with cancelled policies. Just over 40 days remain before the 2006 hurricane season starts. The approaching season is of particular concern to three dozen small insurance companies.
They are having trouble finding what is called re-insurance, which means come June 1 they may start canceling policies unless lawmakers provide some relief.
Jeff Grady of the Florida Insurance Agents says saving the small companies is critical to availability.
Jeff Grady says, “It would be just like a consumer going into hurricane season without insurance. That’s what these companies are experiencing, so they have to decide whether they want to take that risk or whether they want to pull back.”
There is consensus growing to take a billion dollars in surplus revenue and use it to offset citizen’s losses from last year, cutting in half the 20 percent rate hike that everyone is facing.
One plan gaining steam would guarantee that any future hurricane-generated revenue would go to offsetting higher insurance rates.
Sen. Steve Geller, (D) Hallendale, says, “People are not being taxed out of their homes. They’re mortgages aren’t forcing them out of homes. Their insurance rates are forcing them out of their homes. We have to do something to bring insurance rates under control.”
Setting aside future hurricane-generated cash is a step in the right direction, but the bottom line is that insurance may never again be cheap. The question is whether it will be available.
Lawmakers have just three weeks left in the 2006 session to come up with a compromise on homeowner insurance.