The legislative session in Tallahassee began on March 4, with Florida’s House and Senate leaders, along with Governor Ron DeSantis, outlining their priorities amid ongoing property insurance issues in the state, particularly affecting the Florida Keys. This session follows a revealing report on the state’s insurance crisis, highlighting how executives diverted substantial funds away from insurers between 2017 and 2019, creating a weak financial footing and, in some cases, an inability to pay claims. This report, commissioned by the Florida Office of Insurance Regulation (OIR), was never presented to legislators and remained in draft form.
Legislative Priorities
Investigating the Insurance Crisis
New House Speaker Danny Perez emphasized that the Insurance & Banking Subcommittee would investigate the insurance crisis, utilizing all necessary tools such as subpoenas and expert consultations. Insurance companies in Florida, limited to around 4.5% profit margins, have reportedly used financial maneuvers to benefit executives and investors, bypassing profit caps on affiliate and parent companies. The execution of such financial strategies has destabilized the industry, leading to failures and underperformance among insurers and subsequently putting many Florida homeowners at risk.
Governor DeSantis did not directly address the report but commended past legislative reforms aimed at curbing abuses, such as eliminating one-way attorney fees related to the assignment of benefits and prohibiting roofers from covering deductibles. These reforms were critical in attempting to provide a regulatory framework that minimizes the incentives for fraudulent or abusive practices within the property insurance market. However, despite these measures, the system remains fraught with inefficiencies and vulnerabilities that continue to impact consumers negatively.
Senate Initiatives and Accountability Measures
Further reforms mentioned include tightening eligibility criteria for Citizens Property Insurance Corp. (Citizens) policyholders, urging them towards private insurers if comparable policies are available. Senate President Ben Albritton vowed to hold insurance companies accountable for pricing and services, ensuring that no entity exploits the system. His commitment underscores the Senate’s intent to foster a more competitive and transparent insurance market, one where policyholders are not subjected to undue financial strain due to lacking oversight.
Last month, Florida’s insurance regulators approved a rate increase averaging 6.6% for Citizens policyholders with common multi-peril coverage, effective June 1, although specific impacts on the Florida Keys were not detailed. The rate increases are indicative of broader systemic issues needing legislative intervention to ensure fair pricing practices across the state. With the recent rate hikes, families in coastal regions, including the Florida Keys, could face increased financial burdens, necessitating the Senate’s proactive measures to mitigate potential adverse effects.
Proposed Legislative Actions
Limiting Rate Increases
Citizens’ board sought a 13.5% increase last June, constrained by a statutory glide path allowing gradual rate hikes, which was 14% in 2025. Proposed bills by state Sen. Ana Maria Rodriguez and Rep. Jim Mooney aim to limit rate increases to 10% in regions like the Florida Keys, citing a lack of sufficient competition among insurers. This aligns with the advocacy of Fair Insurance Rates for Monroe (FIRM), which highlights that 95% of wind policies in Monroe County are with Citizens, evidence of the necessity for legislative adjustments favoring a more manageable rate path for residents.
The constrained rate hikes are intended to balance the financial viability of insurers while also protecting homeowners from unpredictable, steep increases in their premiums. The legislative actions proposed aim to establish a more stable and predictable economic environment in which homeowners can plan their financial future without the looming threat of unsustainable cost increases. This approach hopefully attracts more insurers into the market, thereby fostering competitive practices that benefit consumers.
Advocacy and Public Awareness
The legislative session in Tallahassee commenced on March 4, with Florida’s House and Senate leaders, alongside Governor Ron DeSantis, detailing their main agenda amid ongoing property insurance challenges in the state, particularly impacting the Florida Keys. This session comes in the wake of a revealing report on Florida’s insurance crisis, which exposed how company executives funneled substantial funds away from insurers between 2017 and 2019, leading to a fragile financial position and, in certain cases, an incapacity to settle claims. The report, commissioned by the Florida Office of Insurance Regulation (OIR), outlined significant mismanagement but was never presented to lawmakers and remained in draft form. Consequently, the legislative focus has turned to correcting these issues to stabilize the state’s insurance market and ensure that similar financial mismanagement does not recur, reinforcing the need for greater accountability and transparency within the insurance industry.
