Monday, June 18, 2018
Editorials

Citizens' corporate welfare puts consumers on hook

The state-run Citizens Property Insurance Corp. wants to make itself stronger by first making itself weaker. The insurer's board voted unanimously Friday to bribe private insurers with $350 million in sweetheart loans to take policies out of Citizens. That means Citizens initially will wind up with less reserves and riskier policies — and that homeowners will pay even higher rates for less coverage while private insurers make out like bandits. It is a flawed strategy that has failed before, and consumers should be outraged by this corporate welfare program.

Urged on by Gov. Rick Scott, Citizens is virtually giving away premium money paid by 1.4 million policyholders in order to shed policies. It reflects the typical Tallahassee thinking that government solutions are always bad and competition and the private market are always better solutions. The problem, of course, is that homeowners are hostages. They have to buy property insurance if they have mortgages, and private insurance remains unavailable or unaffordable — or both — in too many areas of the state.

In fact, Citizens is on a promising path after more than six years without hurricanes. It has a record surplus of more than $6 billion. It has the capability of paying claims from a 1-in-46-year hurricane. And it continues to raise premiums to up to 10 percent a year to gradually build more reserves and get closer to actuarially sound rates. Meanwhile, private insurers are expected to take the most policies from Citizens this year since 2008, including 150,000 by four carriers in November.

Yet Citizens has embraced a new loan program that is too generous to private insurers and has too few protections for consumers. Private insurers could borrow up to $50 million for 20 years at a below-market interest rate of just 2 percent. Yet the insurers only have to agree to take Citizens policies for 10 years, and they can raise policyholders' rates beyond 10 percent a year after three years. If that's not generous enough, there's this: If hurricanes do strike Florida, up to 20 percent of the loan could be forgiven each year for five years.

This is not a new idea. In 2006, the state used $250 million in general tax dollars to make loans to Florida-based insurers who cherry-picked the safest policies and minimally reduced Citizens' risk. In 2008, then-Gov. Charlie Crist vetoed a plan by the Legislature to hand $250 million from Citizens to start-up private insurers. The current governor has no similar interest in protecting consumers, and neither does the Citizens board.

On Friday, the Citizens board rejected efforts to add more protections to the loan plan. One board member even suggested allowing start-up companies to participate. And no public comment was allowed, at least until Sen. Mike Fasano, R-New Port Richey, interrupted on a phone line and asked why the board was so concerned about what the insurance industry wants.

That question went unanswered, but the silence said volumes.

Comments
Editorial: Trump should stop taking children away from parents at the border

Editorial: Trump should stop taking children away from parents at the border

Innocent children should not be used as political pawns. That is exactly what the Trump administration is doing by cruelly prying young children away from their parents as these desperate families cross the Mexican border in search of a safer, better...
Updated: 8 hours ago

Editorial: ATF should get tougher on gun dealers who violate the law

Gun dealers who break the law by turning a blind eye to federal licensing rules are as dangerous to society as people who have no right to a possess a firearm in the first place. Yet a recent report shows that the federal agency responsible for polic...
Published: 06/17/18
Updated: 06/18/18
Editorial: Encouraging private citizens to step up on transit

Editorial: Encouraging private citizens to step up on transit

The new grass-roots effort to put a transportation package before Hillsborough County voters in November faces a tough slog. Voters rejected a similar effort in 2010, and another in 2016 by elected officials never made it from the gate. But the lates...
Published: 06/15/18
Editorial: 40 years later, honoring remarkable legacy of Nelson Poynter

Editorial: 40 years later, honoring remarkable legacy of Nelson Poynter

Forty years ago today, Nelson Poynter died. He was the last individual to own this newspaper, and to keep the Times connected to this community, he did something remarkable. He gave it away.In his last years, Mr. Poynter recognized that sooner or lat...
Published: 06/15/18

There was no FBI anti-Trump conspiracy

The Justice Department released Thursday the highly anticipated report on the FBI’s handling of the Hillary Clinton email probe and other sensitive issues in the 2016 election. It is not the report President Donald Trump wanted. But there is enough i...
Published: 06/14/18
Updated: 06/15/18

Voter purge may be legal, but it’s also suppression

The Supreme Court’s ruling last Monday to allow Ohio’s purging of its voter rolls is difficult to dispute legally. While federal law prohibits removing citizens from voter rolls simply because they haven’t voted, Ohio’s purge is slightly different. T...
Published: 06/14/18
Updated: 06/15/18

Editorial: Free rides will serve as a test of whether the streetcar is serious transportation

Who wouldn’t jump at the chance to ride for free?This fall, the TECO Streetcar Line eliminates its $2.50-a-ride-fare, providing the best opportunity yet to see whether the system’s vintage streetcar replicas can serve as a legitimate transportation a...
Published: 06/14/18
Updated: 06/15/18

AT&T and the case for digital innovation

A good way to guarantee you’ll be wrong about something is to predict the future of technology. As in, "One day, we’ll all …" Experts can hazard guesses about artificial intelligence, driverless cars or the death of cable television, but technologica...
Published: 06/14/18
Editorial: State, nonprofits share obligation to help Hillsborough’s foster kids

Editorial: State, nonprofits share obligation to help Hillsborough’s foster kids

The Florida Department of Children and Families has correctly set a quick deadline for Hillsborough County’s main child welfare provider to correct its foster care program. For too long the same story has played out, where troubled teens who need fos...
Published: 06/14/18
Editorial: Educate voters on Amendment 4 and restoring felons’ rights

Editorial: Educate voters on Amendment 4 and restoring felons’ rights

This fall voters will have 13 constitutional amendments to wade through on the ballot, but Amendment 4 should get special focus. It represents a rare opportunity to rectify a grievous provision in the Florida Constitution, which permanently revokes t...
Published: 06/13/18
Updated: 06/14/18