January 23, 2009
“On behalf of Associated Industries of Florida and our members across Florida, I applaud Senator President Atwater for his willingness to consider unfreezing Citizens Property Insurance rates. AIF has long been a proponent of returning Citizens to its original intent – that of an insurer of last resort. The state of Florida should not be in the insurance business and only by
reigning in Citizens will we see the return of a healthy and competitive private property insurance market.
In 2007, in response to our members’ outrage over the threat of policy assessments or ‘hurricane taxes’ to fund losses as a result of hurricane damage, AIF formed a broad coalition of business associations, professional associations, and charitable organizations called the Florida Hurricane Crisis Coalition (FHCC) to make recommendations to the Legislature as to how to better manage Florida’s hurricane exposure. At that time, many of the recommendations focused on the expansion of Citizens. Based on the coalition’s deliberations, AIF encourages legislators to:
Remove the freeze on Citizens’ rates and beginning July 1, 2009, phase in Citizens’ rate increases over a two-year period so rates are (1) actuarially sound according to the standards applied to private insurers; (2) not competitive with private insurers; and (3) sufficient to provide funding for a ‘Special Claims Reserve’ to substantially reduce the frequency and magnitude of the ‘hurricane tax.’
Today, we are encouraged by President Atwater’s remarks and we pledge to work with him and other legislative leaders on this critically important issue for our state. We cannot continue to place the citizens and businesses of Florida in financial peril.”