This past week Florida state legislators turned their attention to a problem that is becoming increasingly more expensive: questionable sinkhole claims. These claims are purportedly driving up the costs of insurance premiums for Florida homeowners.
The Senate Banking and Insurance Committee heard testimony, but did not take action on the bill which is similar to one that was vetoed by Charlie Crist last year. The bill is aimed at making homeowners’ policies more affordable by establishing a more competitive private insurance market.
Senator Garret Richter of Naples stated that all he was trying to do was let the marketplace work and proposes that the bill would allow consumers to choose the product and insurer they want. Sen. Richter was the legislator who steered the previous insurance bill through the halls of the Florida legislature. Former Gov. Charlie Crist stated he vetoed that bill because it was “not consumer-friendly enough”.
The last major hurricane to hit Florida was in 2005. Since then, sinkhole claims have exponentially increased. In the past three years sinkhole claims have totaled $2 billion. Also, premiums for sinkhole claims have tripled in the last three years for homeowners across the state. However, two-thirds of claims arise from Hernando, Hillsborough, and Pasco Counties.
Some amendments to the bill were challenged because legislators felt they were too favorable to the insurance industry. Senator Mike Fasano of New Port Richey believes that if the reins are loosened too much, insurers will have the ability to refuse to provide sinkhole coverage.
Although the committee adjourned before finishing work on the bill, they plan on starting back up again.
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