TALLAHASSEE, Fla. — In his first one-on-one television interview since becoming Speaker of the Florida House, Paul Renner (R-Palm Coast) detailed the grim picture Florida is facing as its homeowner’s insurance market continues to see carriers flees the state and rates rise.
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“Our market is in a pretty bad spot right now, it was that way before (hurricanes) Ian and Nicole and now it is in real jeopardy,” says Renner who is set to preside over a December special session of the Florida Legislature to deal with insurance. “We have to address two things, capacity in the market and stability in the market.”
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In May, lawmakers returned to Tallahassee for a special session called to try and stabilize homeowner’s insurance. At the time six carriers had gone into liquidation, rates were skyrocketing, and the state-backed Citizens Property Insurance was nearing 1 million policies.
As a fix, lawmakers passed new rules for roofs and created a $2 billion reinsurance fund to help private carriers try and stay solvent.
In August, Citizens crested 1 million polices with the so-called “insurer of last resort” now holding 1.1 million. In September, Hurricane Ian hit the state causing upwards of $40 billion in property damage. Six weeks later, Hurricane Nicole made landfall, causing even more damage.
Today, we convened the 91st Florida House of Representatives. I am honored to preside over a chamber that will bring new, bold ideas to fuel Florida’s economy, empower our families and communities, and set up future generations for even greater success.— Paul Renner (@Paul_Renner) November 23, 2022
Now, lawmakers are preparing to go back to Tallahassee to try one more time.
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“People need to be able to obtain insurance, that is our first priority because lenders will require this, then we need to bring down rates,” says Renner, laying out the contours of what he expects to pass in the December special session.
The Speaker expects lawmakers to target one-way attorney’s fees as well as assignment of benefits as they look for ways to cut back on litigation in Florida, which represents only about 9% of all homeowner’s insurance policies, but yet accounts for about 79% of all lawsuits.
Florida will also need to dip into its reserves, again, and pump more taxpayer money into reinsurance, the coverage insurance companies buy to protect them from high claims, this reinsurance will be due in January, meaning money must be provided before then. Renner expects the state to fund this at least once more but leaves the door open for even more down the line.
“It will still not show a downturn in rates for a year, two years, three years out, it is going to be a painful next couple of years,” says Renner.
There is also expected to be a push to reign in Citizen’s Property Insurance which in many parts of the state is the least expensive option, making the state-backed carrier what some have called a “predatory actor” in the market since its rates are set by politicians.
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It is unclear how Citizen’s will shed policies, however, there is wide consensus that Citizen’s current exposure, which could swell to 1.5 million policies next year is untenable and a significant vulnerability for all Florida taxpayers.
While the Governor has not officially called lawmakers back, leadership has already told members to prepare for a December 12-16 special session.
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