I Don't Get It...
I always find it fascinating when the business interests in this state complain about increased taxes and fees and then turn around and attempt to impose the same on their customers. Though I understand why trade groups like the Florida Chamber of Commerce and the Associated Industries of Florida put the interests of businesses above those of consumers, I do not understand how they can, in good faith, offer arguments so rife with hypocrisy.
This last legislative session, The Florida Chamber and AIF fought tooth-and-nail for the passage of Senate Bill 408. The Chamber even held an insurance symposium in an attempt to explain to Florida powerbrokers why 408’s changes were needed. In the end, of course, the powerful insurance lobby won its victory and, as we’re now seeing with the exorbitant rate increase proposals by Citizen’s Property Insurance Corporation, Florida insurance consumers were dealt a devastating blow.
At the very same time they were fighting to raise premiums on Florida’s policyholders, The Chamber and AIF were complaining about relatively small increases in rates for business interests. For example:
With the help of business-minded policy makers, many of the issues that AIF is championing this legislative session are moving at a rapid pace. Other measures, including legislation to lighten the burden of Unemployment Compensation taxes on business, are also moving swiftly through the legislative process.
[T]he legislation is a key piece to the state Legislature’s pledge to reduce regulations and taxes on small businesses. [Nancy Detert] said small businesses have been getting hit with higher and higher unemployment taxes to pay for all the unemployed, even when people are fired for good cause”: Some businesses are not hiring new workers because of the cost of the unemployment taxes, Detert said. “It really turned out to be a job tax that doesn’t help anyone,” said Detert, who sponsored the legislation in the Senate.
The Chamber and AIF lobby complain about the “unemployment compensation” taxes. They argue that the tax hurts everyone and leads to unemployment. What will insurance premium increases across the board and, in particular, 400% for Citizens do for everyone? Does the same argument not apply to policyholders? Increased fees and taxes are bad… particularly in the current economic climate.
Florida business owners could see their workers’ compensation premiums go up if regulators agree to raise rates by a recommended statewide average 8.9 percent.
The National Council of Compensation Insurance (NCCI) submitted their annual filing calling for the increase, which marks the second consecutive year the rating agency has requested a rate hike. Last year, NCCI filed for a statewide average 8.3 percent increase.
NCCI attributed this year’s increase to an upsurge in claims frequency and loss trends, which the organization said could be attributed to a weak economy.
Herein lays the biggest hypocrisy: While an 8.9% premium increase will cause AIF and the Chamber to fall all over themselves complaining about more fees and taxes, a 400% statewide average increase in sinkhole premiums (2,000% in some areas) is met with glee. Compare a 8.9% increase for businesses to a 400% increase for policyholders. Seems a bit out of whack doesn’t it? The hypocrisy of the Chamber and AIF when it comes to insurance rates is obvious: fee/tax increases for business will kill jobs and are bad for all Floridians, but insurance rate increases are pro-consumer and will help everyone.
Sean, I see your point but, think you may have not considered the bigger picture here. Businesses are paying huge assessments for prior deficits in Citizens personal lines accounts; it's paid on "any" policy that covers property so it's based on the liability premium as well. In many instances those costs are passed on to Homeowners, who are already paying assessments for the same deficits. This is a "double dip" of the worst kind. Example; a mall developer in Orlando received his renewal premium with a $60,000 assessment for (Citizens, Cat Fund, FIGA). His agent was embarrassed and tried to explain, but...the developer said not to worry because all of his leases allow him to pass government surcharges to his tenants, who are all small businesses, i.e hair salons and Pizza parlors, who pass them on to their customers.
I get it.
It's called greed. I believe I have recently coined a phrase in regards to this level of greed in our society..
"Uber-greed".
All these decisions are rooted in the financial reports of the corporate contributors to the lobbyist behind these bills at the state level as well as in Washington.
I remember as a child growing up in the 70's my father discussing the neighbors who were suing their homeowners policy for some claim or another and my father saying "that they were bad Americans" for suing their insurance company. My question on this point is this: Who do you think propagated the thought that it was un-American to sue and or make a claim against your homeowners policy provider?
I would say it is part of the same faction of business persons described herein above, the Uber-Greedy.....
@ Scott - I was more focused on the hypocrisy of the Chamber/AIF messaging. You correctly point out the background. However, when in Tallahassee, all we hear is that ANY tax/fee increase will kill jobs and hurt the economy (anti-consumer). On the other hand, a proposed 400% statewide premium increase is somehow "pro-consumer."
@ Michael - exactly.