Insurance: Candidates want you to know they care
|Here are some of the images and messages about the insurance crisis on the websites created by the Democratic and Republican candidates in the race for governor and chief financial officer. For more detail on candidate plans and positions, go to their websites.
With early voting in the November mid-term election already under way, the state wind insurance crisis has become a burning issue as candidates focus their speeches, advertisements and Web sites on the insurance problem and make tough statements about what they would do to fix it.
State Rep. Bill Galvano, a Republican who is unopposed for re-election to the 68th District, which includes Anna Maria Island, said that insurance has become "if not the top issue, then one of the top two or three issues."
At the gubernatorial level, the candidates for both major parties are making a special effort to present themselves as activists looking out for property owners hard hit by the absence of affordable wind coverage.
"The crisis that homeowners and business owners are facing because of rising insurance costs is critical to the future of the state and will be one of the biggest challenges that the next governor faces," says Josh Earnest, communications director for the Jim Davis campaign.
Earnest told The Islander that the insurance crisis is a critically important part of Davis' stump speech and "it is something he talks about on every stop."
Davis is the 11th District congressman from the Tampa-St. Petersburg area running for governor on the Democratic ticket.
Charlie Crist, the current Florida attorney general from the Pinellas County area is the Republican candidate for governor. According to the Crist campaign materials, "no issue is more on the minds of Floridians than the rising cost of insurance."
The Crist plan
Here are highlights of what Crist proposes, based on the information posted on his Web site:
"It is my fundamental belief that the insurance industry should assume the financial risk for hurricanes.... Therefore, the first step to bringing private insurers back to Florida is to provide affordable reinsurance for them so that these companies can, in turn, pass those savings on and provide affordable insurance to homeowners." He would do this by making funds in the Florida Hurricane Catastrophe Fund (the so-called Cat Fund) "more readily accessible to residential insurers." The Cat Fund was established by the state in 1993 as a way to reimburse insurance companies for a portion of their catastrophic hurricane losses.
"I will require insurance companies to provide home inspections so that homeowners know what they can do, like adding hurricane shutters and exterior doors.
"I will require the Insurance Consumer Advocate to publish an annual report card that analyzes the claims handling, consumer complaints, profit margins, and financial health of every insurance company."
For more detail on the Crist approach to the insurance crisis, go to his website at www.charliecrist.com and click on the button for policy papers.
The Davis plan
Candidate Davis would establish what he calls a "Hurricane Premium Protection Fund Plan" and a "Policyholders Bill of Rights." Here are some of the main points of the Davis proposal, based on his Web site:
The Davis Protection Plan "will lower rates by providing inexpensive capital to insurance companies to allow them to pay claims in a timely and efficient manner." He says it "will lower rates because the fund will accrue capital during less damaging hurricane seasons" and "spread risk across every property in Florida to keep rates low."
Davis would also restructure the Cat Fund. He says it will be "capitalized with a portion of the premiums collected by insurance companies from windstorm policies...."
"Insurance companies will be prohibited from raising rates without prior approval from the Office of Insurance Regulations...."
Davis' "Bill of Rights" for policyholders would include rights to "stable insurance premiums," the settling of damage claims "fairly and quickly," a "fully funded, financially sound Hurricane Catastrophe Fund," and rights to "easily obtain low-interest loans" to strengthen their homes and businesses against hurricane damage.
For more details on the Jim Davis plan, go to his Web site at www.jimdavis2006.com.
The race for chief financial officer
Don't stop with the candidates in the race for governor. Check out what the two candidates for Chief Financial Officer are saying. Because of a 2002 state law merging the Department of Insurance with the Department of Banking and Finance, the CFO today has many responsibilities including the regulation of Florida's insurance market and the monitoring of the state's 226,000 insurance agents.
The Democrat in this race is Alex Sink, a former Florida Bank of America president who has held state and civic positions and now lives in the Tampa area with her family. On her Web site - www.alexforcfo.com/insurance - Sink makes these points:
"If insurance companies are refusing to pay legitimate claims, I'll make them pay.
"I will call all of my counterparts in coastal states from Texas to Maine and work with them to create a regional catastrophic fund that helps spread the risk.
"We need to expand and strengthen the Florida Hurricane Catastrophe Fund.
"I will increase the number of fraud investigators and otherwise strengthen anti-fraud efforts."
Sink says that Florida has been lucky so far to avoid the
devastating hurricanes of the past two years, "but we can't count on luck to solve our state's property insurance crisis."
Then, in a jab at her opponent, Tom Lee, president of the Florida Senate, Sink says: "In the midst of a full-blown property insurance crisis, the Legislature waited until the last hour of the 2006 session to put a band-aid on a problem that required major surgery. As a result, consumers continue to see their homeowners policies non-renewed or canceled as insurance companies flee our state. Those fortunate enough to find insurance have faced spiraling rate increases that are crippling households and our economy."
Lee, a Republican who represents the 10th Legislative District, including much of Hillsborough County, appears to strike back at Sink on his Web site - www.tomleeforcfo.com - with these remarks:
"Contrary to critics, many of whom are using the insurance crisis for political gain, Florida leaders have already begun the process of reform by proposing both long-term and immediate solutions."
Lee goes on to say that "our situation will not be resolved with sound bites, rhetoric or election-year promises; we must draw upon the expert advice of business leaders, consumer advocates, and policy makers across our state to provide the wisdom and insight needed to rebuild a strong, affordable, and sustainable insurance market in Florida."
Here is what Lee says he has done about the insurance crisis:
"I asked Gov. Bush to commission a task force on property and casualty insurance reform - comprised of non-insurance industry business leaders and consumer advocates.
"I suggested the group meet while the legislature is not in session in order to receive and evaluate policy option.
"I asked Gov. Bush to consider activating a Joint Underwriting Association for commercial property." The JUA would have the potential to provide insurance to commercial property owners who cannot find private coverage."
Galvano: Candidate focus on insurance is good
Galvano couldn't be happier about all the attention that campaigns are giving to insurance. In his view, the controversies kicked up by candidates talking about insurance are adding to the pressure for elected officials to come up with solutions that benefit the public.
"Each party is trying to blame the other for the current situation," he said. "So whoever gets elected is going to feel a real mandate to go and work on this issue to do whatever we can to make it better for the citizens of Florida."
Galvano, who has been a leader in the effort to find solutions for the insurance crisis and who expects the governor to call a special session in early December to look at insurance, said "people are so tuned into this" that the insurance industry won't be able to control the solutions that are developed by the Legislature.
He said that people will be looking to see how their senator or representative is voting, and this has the potential to make a big difference in what the government actually does.
Galvano notes that "even the federal candidates are talking about insurance." That awareness can help Florida consumers, he said, because one of the proposals under consideration is the idea of a national catastrophe fund that could be "worked into the picture, especially given what happened in New Orleans."
In looking at the problem and at the need for action, Galvano believes government is going to have to come up with some relief for property owners.
"If we don't do something," he said, "I think you will certainly see the ramifications in the next election cycle."
Meantime, there is the human element.
"People are so upset about what is happening to them," he said. "I hear from constituents and they don't know where to turn. Insurance goes up and those are the lucky ones. The others just get canceled."