Florida's strategy for dealing with property insurance in a state at high risk of hurricanes is getting high praise from a flood insurance work group of the American Academy of Actuaries.
The group's recent report, "The National Flood Insurance Program: Challenges and Solutions," said Florida lawmakers had found the right recipe in creating the state's insurer of last resort, the Citizens Property Insurance Corp., and taking other steps to stabilize the insurance market. Citizens covers consumers when private companies refuse to enter such a risky marketplace.
"Florida's innovative approach to its hurricane problem illustrates how public policy can be tailored to addressed many of the problems the (National Flood Insurance Program) faces," the report said.
Others can learn from the Florida example, the academy of actuaries said.
Of course, Citizens recently announced its first loss since 2005, a $27.1 million hit that the insurer may have to pass along to customers, its board of governors announced last month. The loss was due, in part, to higher litigation costs involving water damage claims.