Make us your home page
Instagram

House approves bill to allow unregulated insurers to take over Citizens policies

TALLAHASSEE — Florida's mammoth state-run insurance company is looking to downsize, with lawmakers turning to unregulated out-of-state carriers to help with the effort.

The state House passed a bill on Friday that would allow so-called "surplus lines" carriers to take over policies from Citizens Property Insurance Corp., if they meet certain criteria.

Surplus lines carriers are not regulated by the Office of Insurance Regulation and can differ greatly from the state's admitted insurers, a point that opponents of the bill pushed repeatedly.

"Everyone agrees that Citizens needs to be smaller, but the way to do that is not to allow essentially unregulated companies to move in like vultures," said Sean Shaw, founder of Policyholders of Florida. "This is essentially deregulating the insurance market in Florida for rates."

Bill sponsor, Rep. Jim Boyd, R-Bradenton, included several safeguards to raise the barrier of entry for surplus lines insurers looking to pick up clients in Florida. For example, the carrier would have to have at least $50 million in surplus, a strong financial record and enough resources to withstand two massive hurricane hits. The insurer also must offer homeowners coverage that is similar to their Citizens policy.

"Surplus lines carriers have been (operating) in this marketplace for years on the commercial side and actually they're very good, very strong and very competitive," Boyd said.

Still, opponents of the bill pointed out some major differences between Citizens and surplus lines insurers, which typically have higher premiums. For example, surplus lines carriers can raise their rates by any amount, and if they become insolvent, the Florida Insurance Guaranty Association will not offer homeowners a safety net for paying claims.

Under the proposal, homeowners could be automatically shifted into a surplus lines account if they do not opt out within 30 days of being notified. However, consumers who are unhappy with their new carrier could later return to Citizens.

House approves bill to allow unregulated insurers to take over Citizens policies 02/03/12 [Last modified: Friday, February 3, 2012 11:18pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. Exploratory Lab Boot Camp provides real-life technology training to students

    Science

    CLEARWATER — At this graduation ceremony featuring some of the brightest local minds in tech, it was the youngsters who stood out.

    Laszlo Leedy, 17, a senior at Shorecrest Prep, presents part of his team's project for SPC's Exploratory Lab Boot Camp. Students presented their ideas at the end of the SPC Exploratory Lab Boot Camp. The program provides real-time business training to students. This year's graduation celebrated 15 students that finished the program. 
[JIM DAMASKE   |   Times]
  2. Appointments at the Crisis Center of Tampa Bay and World of Beer highlight this week's Tampa Bay business Movers & Shakers

    Business

    Non-profits

    Tampa Bay Watch, Inc., a 501 (c)(3) non-profit organization dedicated to the protection and restoration of the marine and wetland environments of the Tampa Bay estuary, has announced two new employees. Pamela Arbisi is the new development director. Her responsibilities include …

    Scott Bendert has joined the Crisis Center of Tampa Bay as the non-profit organization's Chief Financial Officer. [Company handout]
  3. Tampa's Homeowners Choice seeks to offer flood insurance in other states

    Banking

    Tampa-based insurance company HCI Group Inc.'s subsidiaries are trying to expand their flood insurance offerings beyond Florida. HCI has filed with regulators to offer flood coverage in Arkansas, California, Maryland, North Carolina, New Jersey, Ohio, Pennsylvania, South Carolina and Texas.

    Tampa-based HCI Group is trying to expand its flood insurance offerings to other states. Pictured is Paresh Patel, CEO of HCI Group. | [Courtesy of HCI Group]
  4. Home of Tampa Bay Lightning GM Steve Yzerman hits market at $3.45 million

    Real Estate

    TAMPA — The Davis Islands home of Tampa Bay Lightning General Manager Steve Yzerman is back on the market for $3.45 million after a brief hiatus.

    The Davis Islands home of Tampa Bay Lightning General Manager Steve Yzerman is on the market for $3.45 million. [Courtesy of Hi Res Media]
  5. Trigaux: Halfway through 2017, a closer look at six drivers of the Tampa Bay economy

    Business

    We're nearly halfway through 2017 already, a perfect time to step back from the daily grind of business and ask: How's Tampa Bay's economy doing?

    Is there one theme or idea that captures the Tampa Bay brand? Not really but here's one possibility. The fun-loving annual Gasparilla "Invasion" of Tampa is captured in this photo of 
The Jose Gasparilla loaded with pirates of Ye Mystic Krewe of Gasparilla on its way this past January to the Tampa Convention Center. In the future a vibrant downtown Tampa or St. Petersburg may be the better theme. [CHRIS URSO   |   Times]