Homeowner’s Insurance
As a Florida resident for over 21 years, I have watched homeowners’ insurance rates go up and down. However, the skyrocketing premiums Florida has experienced over the past year have me just as worried as you. Answers to this crisis will take expert opinions, advice, and research, not off-handed quick fixes.
The problems facing Florida are complex and unique – we are surrounded by water on three sides, and thus more prone to hurricanes than other coastal states. Therefore, Florida’s insurance market should be governed by those elected to represent Florida, not Washington bureaucrats who have never lived here and do not face our unique challenges.
After Hurricane Andrew, when 11 insurers became insolvent and dozens more threatened to leave, Florida state lawmakers, like me, passed sweeping and innovative reforms. Florida was the first state to enact a State Catastrophe Fund, which is funded through premiums from insurance providers in Florida. In return, in the event of a natural catastrophe, insurance providers receive financial assistance from this fund to help pay for homeowners’ losses. This second layer of insurance protection has helped insurance providers in Florida remain solvent and provided an incentive to continue to operate in our state.
In the wake of disaster, Florida lawmakers took the problem into their own hands, and that’s what all states should be able to do. Federalization of this crisis doesn’t make it go away, it just makes it bigger.
That’s why I introduced H.R. 4366, the Homeowners’ Insurance Protection Act. My bill builds on the lessons Florida has learned since Hurricane Andrew and adds a third layer of protection. Just as insurance providers pay into the Florida State Catastrophe fund, states with established state catastrophe funds will pay into the federal Hurricane and Earthquake Loss Protection Fund. In return, states that experience catastrophes will receive financial assistance from the federal fund.
My bill rewards states like Florida for enacting preventative measures, like state catastrophe funds, mitigation plans, and state-wide building codes. My bill keeps this decision-making in Florida.
More importantly, H.R. 4366 guarantees that your tax dollars are never used to cover claims! Both the State and the Federal Catastrophe Funds are made up entirely of insurer premiums. With H.R. 4366, insurance providers are the insurer of last resort as they should be, not the federal or state government.
There are no band-aids or quick fixes to the insurance crisis, but Florida lawmakers should address this issue because they are the best to do it. Congress can help by providing a federal backstop to states’ efforts, which is why I am pushing H.R. 4366. I am a homeowner too, and I will not sit back and watch millions of residents lose their homes and their livelihood.