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Senate passes insurance measure

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The Associated Press

Published: April 29, 2009

TALLAHASSEE - Customers of the state-backed Citizens Property Insurance Corp. are going to see their premiums rise, but by how much hasn't been finalized.

The Senate on Tuesday passed an amended version of a House proposal (HB 1495) by a 34-2 vote and sent it back with a 5 percent cap on the increase - albeit that could be too little in lawmakers' efforts to get the insurer of last resort up to healthy actuarial levels.

The bill that passed the House last week limits the annual rate increases to an average of 10 percent for more than 1 million Citizens' customers.

Without the legislation, Citizens' policyholders could see premiums increase more than 40 percent on Jan. 1. With the legislation, they would pay the increase in smaller increments.

The goal of the legislation is to shore up Citizens' solvency and reduce the state's $20 billion exposure on the Florida Hurricane Catastrophe Fund by phasing out upper levels of a state-supported insurance backup pool by $2 billion a year until it's eliminated in six years.

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