Lawmakers are back at work discussing ways to lower home insurance premiums for homeowners across the state.
On Monday, a Florida Senate committee overwhelmingly approved two measures that supporters believe will go a long way toward addressing access and affordability of home insurance and to take steps in reducing insurance fraud in Florida’s property insurance market.
SB-2D and SB-4D provides some needed improvements to Florida’s insurance market for stressed property insurers. The measures tackle reducing roof claims, litigation expenses and reinsurance costs. Some highlights of the measures are listed below,
Undoing part of the Florida building code that now requires full roof replacement in most cases when only 25% or more of a roof is damaged.
The creation of a new, lower-level catastrophe reinsurance fund – would be backed by $2 billion from the Florida general fund. Instead of insurers paying premiums into the Reinsurance to Assist Policyholders fund, or RAP fund, participating insurers would be required to provide rate relief to their policyholders. The program would be for hurricane losses for one year only, to help some carriers who may not be able to otherwise afford reinsurance in the private market.
For those carriers who already have secured reinsurance this year, they could access the RAP fund next year.
“This legislation comes at a crucial time, although changes probably won’t be felt until sometime down the road” says Dustyn Shroff, Vice President of GreatFlorida Insurance, Florida’s top independent home insurance agency.
The Insurance Journal reports, “One actuary has calculated that the plan could produce average premium reductions of as much as 4% for policyholders of participating insurers in the next several months.”