Article
Courtesy of News Service of Florida
By
Jim Saunders
Published March 22, 2022
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Lawmakers could not reach an agreement
Friday on a plan to address problems in Florida’s troubled
property-insurance market, while also halting efforts to put
additional requirements on condominium buildings after a
deadly collapse last year in Surfside.
Finishing most of the work in this year’s legislative
session, the House and Senate could not work out differences
on high-profile insurance and condominium bills.
The insurance debate came as homeowners face soaring
premiums and lost coverage while insurers grapple with
financial troubles. The Florida Department of Financial
Services during the past two weeks went to court to be
appointed a receiver for St. Johns Insurance Co. and Avatar
Property & Casualty Insurance Co., describing the insurers
as “insolvent.”
Sen. Jeff Brandes, a St. Petersburg Republican who pushed
lawmakers to deal with problems in the industry, said Friday
that financial rating agencies and reinsurance firms were
waiting to see how the Legislature would address the issues.
Without a bill passing, he said it could lead to more
insolvencies and increases in costs for reinsurance, which
is essentially backup insurance that insurers buy.
“I think this gives the governor a perfect reason to call a
special session,” Brandes said.
The House and Senate disagreed throughout the session about
how far to go in making changes in the industry, with the
Senate being more aggressive in trying to bolster private
insurers.
As an example, the Senate proposed allowing new deductibles
of up to 2 percent on roof-damage claims — an outgrowth of
complaints by insurers that questionable, if not fraudulent,
roof claims are driving up costs. As an example, under the
Senate proposal, a homeowner with $300,000 in overall
coverage could have faced a $6,000 deductible to replace a
damaged roof.
But the House rejected the idea, which would have led to
increased out-of-pocket costs for homeowners who need to
replace damaged roofs.
A House bill addressed issues such as changes at the
state-backed Citizens Property Insurance Corp., but House
Speaker Chris Sprowls, R-Palm Harbor, signaled early this
month that the House wouldn’t go much further. He cited a
property-insurance bill that lawmakers passed last year.
“I’m also cognizant of the fact that we just passed a very
significant insurance bill last session,” Sprowls said at
the time. “If what has been told to me in the eight years
that I’ve been here from the insurance lobby is true, which
is that it takes 18 months to see an impact in rates, which
is what I’ve been told over and over and over again, then I
don’t think we’re yet seeing the impact that we’re having in
rates by the bill that we passed last year.”
Brandes said the House didn’t propose anything that “moved
the needle significantly.” Speaking to reporters after a
floor session, Senate President Wilton Simpson, R-Trilby,
said a special session on insurance was a possibility.
“We have many companies going out of business,” Simpson
said. “It's certainly a crisis. I think I said a couple of
weeks ago that we will have failed if we didn't pass a good
property insurance bill. And so there is a possibility in
the coming months, especially as we get into hurricane
season, it will be a heightened opportunity. And I think the
Senate had a formation of a pretty good bill this year, and
we just didn't get finished.”
Lawmakers will meet Monday to pass a budget and related
bills, but they finished taking up all other legislation
Friday.
Like with the property insurance bill, the House and Senate
differed throughout the session about how far to go in
placing additional requirements on condominium buildings.
That issue stemmed from the collapse last year of the
Champlain Towers South building in Surfside that killed 98
people.
House and Senate bills dealt with issues such as required
inspections and financial reserves that could be used to
make building repairs. The House wanted to go further than
the Senate on issues such as reserve requirements for
condominium associations.
“This was important life safety legislation to help ensure
Florida never experiences another Surfside tragedy,” Allen
Douglas, executive director of the Florida Engineering
Society and American Council of Engineering Companies of
Florida, said Friday after lawmakers couldn’t agree on a
bill. “It’s a missed opportunity to pass much-needed
statewide building safety guidelines.”
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