Economy killer? You can't just jack up sinkhole policy rates and say 'problem solved'
Wake up and good morning. You may be whispering There but for the grace go I when it comes to avoiding the curse of sinkholes. But the current plan by Citizens Property Insurance to jack up sinkhole coverage to ludicrous prices is absurd and, at the least, a profound lack of imagination in finding financial solutions to dealing with a natural disaster that, like hurricanes, goes beyond the Florida homeowner's ability to control.
This rally (St. Petersburg Times photo) in New Port Richey this week, organized by the consumer advocate coalition Policyholders of Florida, is a sign of the mounting outrage sparked by a unanimous vote by the Citizens board to request the increases, citing the skyrocketing cost of sinkhole claims. How much of an increase? If approved by the state's Office of Insurance Regulation, the rate increases mean the average premium for a sinkhole policy in coastal Pasco County would increase from $1,270 to $3,598. In coastal Hernando County, premiums would soar from $1,356 to $5,734.
Read the St. Petersburg Times coverage here and watch the accompany video. Catch the ABC Action News coverage here. The WTSP coverage here points out allegations of rampant fraud causing much of the insurance increases. And a WUSF story here notes Pasco State Senator Mike Fasano (that's him waving in the photo) hopes a public outcry at next month's public hearing in Tampa will help roll back the rate hikes.
Said Fasano at the rally: "This is the epicenter, if you will, of how these rates will affect the most. It's the Pasco, Hernando, Citrus, Hillsborough and Pinellas county areas, where people who are struggling today are going to end up losing their homes." The WUSF story cites one senior citizen who told Fasano if the new rates are approved, she'd have to pay $4,000 more a year - which would send her home into foreclosure.
The state Office of Insurance Regulation has scheduled a hearing on the proposed new rates for Citizens Insurance September 13th at the Tampa Convention Center. Here are those details.
Sorry, Citizens. It's easy to raise rates and say "problem solved." But who would buy a home in, for example, New Port Richey that in effect carries an extra $5,000 price tag on it every year? That isn't going to work. Those economics could drag sinkhole-prone counties to their knees. There has to be a better way. How about some real state leadership on this matter?
-- Robert Trigaux, Business Columnist, St. Petersburg Times