FL House Leaders Unveil Property Insurance Plan

The Florida House weighed in today with its plan to reform property insurance laws in the state. The House plan moves away from the free-market environment in which property insurance now exist in favor of move government control.

From the Miami Herald:

Insurance rates would be frozen for Citizens Property customers for one year and private insurance companies could buy state-subsidized back-up insurance as long as they passed on all of their savings to consumers and dropped rates at least 25 percent.

Those are two of the top money-saving ideas included in six sweeping insurance proposals to be unveiled by the Florida House this afternoon. Other ideas include firing the board of directors running Citizens, repealing the Citizens rate increases set to take effect this year and allowing Citizens' policyholders to make insurance payments on an installment plan.

The draft bills are a hybrid of proposals that emerged last fall in the House Republicans' ''100 Ideas'' book, the House Democrats' plan, as well as suggestions pushed by Gov. Charlie Crist or made by the insurance industry.

Absent from the package of ideas is the proposal pushed by Senate leaders to expand Citizens, the state-run insurance company, so it could spread its risk and better compete with the private insurance market by letting it write more than just windstorm insurance.

View the six House bill proposals here.

The House plan is closer, in some ways, to proposals discussed by Gov. Crist than it is to some positions taken in the Senate proposal.

Unlike the Senate, the House embraces two ideas pushed by Crist during his election campaign. They want to require insurance companies to factor in national profits when their Florida subsidiary requests a rate increase and prohibit the creation of future ''pup'' companies, in which national companies create subsidiaries that can isolate their losses to Florida.

The House also embraces Crist's proposal to ban the practice of ''cherry-picking,'' when an insurance company writes homeowners policies in other states but only writes other lines of insurance in Florida.

The House package also includes bills to allow homeowners to receive credits on their insurance bills for strengthening their homes from wind damage, a bill to include the Panhandle in the statewide building code and a bill that asks Congress to consider creating a national catastrophe fund.

Despite some differences between the Senate and House plans, look for the real fight to be between the Legislature and the insurance lobby. Will come that fight as it develops.