The changing shape of property insurance in Florida, USA

A number of Florida state legal changes have or will affect the insurance market there.

The following comments on these changes are provided by reinsurance broker Towers Watson.

* Among legislation that was filed at the end of 2009 is a proposed bill that would partially deregulate rates for Florida homeowners insurance companies under special conditions. The legislation, House Bill (HB) 447 from Rep. Bill Proctor, is unlikely to be considered before the start of the Florida Session on March 3, 2010.

* The recently passed HB 1495 will reduce the amount of reinsurance offered by the Florida Hurricane Catastrophe Fund (FHCF) by $12 billion over the next six years while instituting a cash build up program to pay claims. The state’s recent efforts would work to reduce FHCF coverage, increase FHCF rates and strengthen the state-run Citizens Property Insurance Corporation.

* The proposed HB 1157 and Senate Bill (SB) 2384 would create a state-run wind-only pool for hurricane risk in Florida. Property owners would have two policies: one with a state-run pool for hurricane coverage and another for the balance of their homeowners coverage.

* The proposed HB 1171 and SB 2036 would give a small number of large insurance companies the option to charge rates that are not subject to approval by Florida’s Office of Insurance Regulation.