“Even after five hurricane-free years, Florida’s insurance market is still in awful shape.
There is less competition, less consumer choice, less financial stability and higher rates.
The best solutions to these problems aren’t a rearranging of the current system — it’s broken beyond repair — but, rather, a fundamental rethinking of the government’s role in providing insurance.
Citizens and the Florida Hurricane Catastrophe Fund — state agencies both — must be scaled back to reduce risk to taxpayers and, particularly in coastal areas, rates may have to rise, especially for expensive homes.
The government has a role in making sure that insurance companies remain solvent and in encouraging individuals to retrofit their houses. But its large-scale intervention has failed dismally.”
Camara’s piece points out several important points: Florida’s insurance market suffers from a systemic failure in regulation and leadership and a full rethinking on how insurance companies are regulated is needed.
While Florida’s location provides unique challenges for any insurer, a truly competitive market could solve many of the state’s insurance ills. Florida has actively worked against insurers over the last few years, fighting every rate increase, demonizing insurance companies and ultimately driving insurers out of the state. The end result is a state reliant on the state run insurer Citizen and the State Catastrophe Fund. Real change needs to come soon.
Camara’s article was originally posted in the Miami Herald and is available online at: http://www.heartland.org/firepolicy-news.org/article/28665/Affordable_Insurance.html