By A.G. Gancarski, Florida Politics, September 5, 2022.
“Before Floridians start losing their homes.”
The increasingly fraught issue of homeowners insurance is a hot topic in the Governor’s race.
Democratic gubernatorial nominee Charlie Crist contends Florida Gov. Ron DeSantis as “unfit to lead” the state’s increasingly wobbly property insurance market, challenging the Governor to reverse price hikes rolled out by Citizens Insurance.
Citizens is the state insurer of last resort that has absorbed policies in the wake of private companies abandoning the state of late.
“Ron DeSantis is unfit to lead our state during the property insurance crisis he created,” Crist said in a release. “After DeSantis doubled property insurance rates, hundreds of thousands of Floridians have nowhere else to turn but Citizens. Now, he’s raising those rates, too!”
An email from Crist’s press shop spotlighted reporting from WPTV that noted an average rate hike for Citizens customers of 6.4%, with yearly hikes scheduled through 2026.
Crist lambasted current policy as a logical consequence of long-term neglect, a “head-in-the-sand” strategy that threatens the property market writ large.
“For years, DeSantis and his allies followed the same playbook with Citizens – raise rates, reduce coverage, and pray the private market will fill the gap. This governor’s head-in-the-sand approach is failing the hundreds of thousands of homeowners who are seeing their rates rise astronomically, or losing their coverage altogether,” Crist decried.
“Only Ron DeSantis could double your rates and think they’re still not high enough. The market is teetering, and people are hurting. Stop these rate hikes and expand the coverage limit, Ron. Before Floridians start losing their homes.”
Coverage limits with Citizens are capped at $700,000, which in many parts of the state is below market value for much housing inventory.
Citizens now holds over one million policies, as private insurers increasingly bail on the market or fail outright. Five insurance companies failed in the first eight months of the year: St. Johns Insurance Company, Avatar Property and Casualty, Lighthouse Property Insurance Corporation, Southern Fidelity Insurance Company and Weston Property and Casualty Insurance Company.
The issues come despite attempts to fix the market, including a Special Session setting up a taxpayer-backed $2 billion reinsurance fund in an attempt to stabilize the market.
Demotech, an Ohio based ratings agency, threatened to downgrade or withdraw ratings for 19 companies in July. In response, regulators allowed companies to use the surplus of Citizens as a reinsurance fund for any company that goes bust.
Image Credits: Charlie Crist, Democratic gubernatorial candidate of Florida, speaks during a primary night party in St. Petersburg, Fla., on Aug. 23. (Tristan Wheelock/Bloomberg News)