Property Insurance Coverage Law Blog : Florida Insurance Lawyer & Attorney : Merlin Law Group Law Firm : Tampa, Houston, Coral Gables, Gulfport

Let’s take a look at the crop of insurance bills, and where they stand:

• HB 245, Relating to Depopulation Programs of Citizens Property Insurance Corporation
  • Sponsored by Boyd
    • Next Cmte: Economic Affairs, 12/8/11 from 9 – 11am in 102 H

• SB 578, Relating to Depopulation Programs of Citizens Property Insurance Corporation
  • Sponsored by Richter
    • Next Cmte: Banking & Insurance, 12/7/11 from 9:30am – 12:30pm in 412 K

HB 245 and SB 578 would allow surplus lines carriers, which are not subject to the same state regulation as admitted carriers, to participate in the Citizens Property Insurance Corporation depopulation program. If implemented, surplus lines brokers would have the ability to review Citizens policyholder underwriting and claims information, then cherry pick the policies they wish to take off Citizens books, leaving the state run insurance company with an even more risky pool of policies. Once a policyholder leaves Citizens, there appears to be no real mechanism for reentry. A surplus lines carrier could conceivably renew the policy with exorbitantly higher rates, free from the rate regulation of OIR.

The House version of this bill has already cruised through its first committee, and is scheduled to be heard on Thursday, December 8th at 9am. The Senate version was scheduled to be heard in the Banking and Insurance committee on December 7th at 9:30am.

• HB 243, Relating to Expert Testimony
  • Sponsored by Metz
    • Next Cmte: Civil Justice, 12/7/11 from 1 – 3pm in 404 H

• SB 378, Relating to Expert Testimony
  • Sponsored by Richter
    • Next Cmte: Judiciary, 12/7/11 from 2 – 4pm in 110 S

HB 243 and SB 378 aim to bring the state of Florida’s evidentiary standard (the Frye standard) into line with federal Daubert standard. Under the Daubert standard, judges would be given more leeway as “gatekeepers” of science. These bills will both be heard in committee for the first time on Wednesday, December 7th.

• HB 427, Relating to Civil Remedies Against Insurers
  • Sponsored by Passidomo
    • Next Cmte: Civil Justice 12/7/11 from 1 – 3pm in 404 H

HB 427, the controversial “Bad Faith bill” is scheduled to be heard in its first committee on Wednesday the 7th at 1pm. This law would effectively chip away at the state’s bad faith statutes – statutes that exist to protect you if your insurance company chooses not to fulfill its end of the insurance contract or act unreasonably when adjusting your claim. Erosion in bad faith laws lets insurance companies evade their contractual obligations and harm policyholders without recourse.

• HB 761, Relating to Property Loss Appraisals
  • Sponsored by Artiles
    • Next Cmte: Not Assigned

• SB 846, Relating to Property Insurance
  • Sponsored by Fasano
    • Next Cmte: Not Assigned

HB 761 and SB 846 have a few things in common. First, they are the only pro-consumer property insurance bills that have been filed for the 2012 legislative session; second, they are the only two property insurance bills that have yet to be assigned a committee.

Coincidence? I think not.

Senator Fasano’s bill would require insurance companies to provide reasonable information to consumers in a timely fashion – hardly a controversial concept. Similarly, Representative Artiles’ bill would simply require Citizens Property Insurance Corporation to comply with conditions & procedures relating to participation of umpires & appraisers in loss appraisal process – a very modest proposal. Yet neither of these bills are scheduled to see the light of day.

That is simply not fair. I will be in Tallahassee this week to listen to the proceedings and to discuss the importance of maintaining legitimate consumer protections in statutory law. If at all possible, I urge you to join me. Even if you can’t make it to Tallahassee, you can make a difference. Call your legislator’s office. Write a quick email and voice your concern. Your opinion matters, and the only way to make a difference is to make yourself heard.

We rarely see legislation that puts common sense above insurance interests. Senate Bill 846 is an exception to that rule.

Here is what the bill does:

• Senate Bill 486 requires insurance companies to disclose to their insureds benefits, time limits and other provisions of a policy that the company may apply to that particular claim. By having everything in the open, consumers will better understand how to deal with their claim.

• Senate Bill 846 also requires insurance companies to provide claim related documents to the insured within a set amount of time. Again, the bill keeps the consumer informed, and helps to limit the delay that too often accompanies the claim process. The insurance industry requires policyholders to reply in a timely fashion and insurers should be held to at least the same standard.

• This bill requires the insurance company to inform the insured about any statute of limitations period that may apply to their claim. If the insured has an attorney, the company does not have to meet this requirement.

• If the insurance company assigns a 3rd adjuster to your claim, this bill requires the insurance company to provide a status report to the insured. Again, the bill keeps the consumer informed.

• Finally, this bill extends the ALE expenses that are provided in a state of emergency to 24 months. ALE expenses are those costs which are incurred when you have to live somewhere else because your home is damaged. This bill gives policyholders a bit more time in the event of a hurricane – when policyholders should be trying to piece together their lives, not having to worry about arbitrary time constraints.

There’s nothing drastic about Senate Bill 846. This bill shouldn’t make any waves – it should be passed quickly. Unfortunately, history shows us that this will almost certainly not be the case. The insurance industry will most likely throw its considerable weight against these simple, straightforward consumer protections.

We must remember that even though most of what we hear out of Tallahassee is bad news, there are still a number of legislators and civic leaders who consistently fight for the 8 million policyholders across our state. I will give you one guess as to the State Senator that filed this bill… If passed, Senate Bill 846 would be a boon to all of Florida’s policyholders. We have to keep up the pressure, and make sure this good bill gets a fair shake in committee and on the Senate floor. I urge all of you to call, write, or email your State Senator, and let them know that you support SB 846.

This victory proves that Floridians, organized and united, can fight the insurance lobby and win.

Citizens board members proposed in July to raise sinkhole rates statewide by 430 percent on average to make them actuarially sound. In the Tampa Bay area -- nicknamed "sinkhole alley" because of insurers' losses on claims there – that would have translated to increases of 2,200 percent in coastal Pinellas County, and 2,400 percent in Tampa.

For the better part of a year, Policyholders of Florida and other consumer advocacy groups warned that insurers would seek these rate increases. It was only after overwhelming policyholder opposition that those in Tallahassee decided to listen.

Though there were some converts in the legislature, most backtracked because the people organized by consumer advocacy groups like Policyholders of Florida and the hard work of tireless consumer champions like Senator Mike Fasano, Representative Darryl Rouson, and Representative Rick Kriseman made them realize that the profits of a few could never justify tremendous financial strain for millions for Floridians. Our consumer champions made it clear that the proposed rate hikes would put some homeowners out of their homes and deliver yet another blow to our struggling economy.

What does all this mean in real terms?

Under the new rates, Pasco and Hernando counties will see average increases for sinkhole insurance of $300 to $400 as opposed to the $4,000 to $5,500 that Citizens had requested, according to State Sen. Mike Fasano, R-New Port Richey. Hillsborough will see increases of about $100 as opposed to the $3,200 increase that was requested, he said.

Though $400 is still a lot to stomach for many Floridians, it’s much more reasonable than the $5,500 hike sought by Citizens.

The Office of Insurance Regulation’s Order confirms what groups like Policyholders of Florida have argued all along: Citizens “provided no credible evidence” that it assessed the effects of SB 408 when making its rate-increase request.

Citizens merely assumed future sinkhole losses would parallel the frequency and severity of other types of losses, such as fire and water. The OIR disagrees.

The OIR is “unable to find that the upward trend for sinkhole losses that Citizens assumes is actuarially supported.”
 

Though I am certain the insurance industry and its lobbyists will continue to claim losses, consumer advocates across the state should sleep soundly knowing that their actions saved countless Floridians, many of whom live on modest fixed incomes, from losing their homes and their financial future.

Despite this distance, there are a number of legislators and civic leaders who consistently fight for the 8 million policyholders across our state who should be recognized. Over the course of the next few months, I will highlight several of these legislators, explain their positions on insurance related issues, and generally shine light on the entire process.

For our inaugural profile, I could think of no one better to highlight than Senator Mike Fasano (R-New Port Richey). A 40 year resident of Pasco County, Senator Fasano was first elected to the Florida legislature in 1994 and has since developed a reputation as something of a maverick – a legislator who refuses to bow to special interests and who always places the needs of his constituents first.

This rebellious streak was featured front and center during some of the most contentious debates of the 2011 legislative session. Senator Fasano bucked the powerful insurance industry lobby, as well as his own party’s leadership, to fight for the people of Florida. Despite heavy pressure from Senate leadership, Senator Fasano fought and managed to defeat several extremely harmful bills that were making their way through the state Senate. One bill, sponsored by Senator Alan Hays (R- Umatilla), would have completely deregulated the insurance industry, allowing companies to charge whatever the market would bear, almost assuredly plunging the state into further economic peril.

Even when bad bills managed to pass through his committees, Senator Fasano consistently offered the most pro-consumer amendments, even in the face of certain defeat. Similarly, he always asked the toughest questions, to both powerful insurance lobbyists and his fellow Senators alike. The Property Casualty Insurers Association of America, the industry’s principal trade group, even went so far as to call Fasano's efforts to stop the passage of anti-consumer bills a "crusade."

Of course, we all know that the insurance industry eventually managed to get its most prized bill, Senate Bill 408, through the legislature and onto Governor Scott’s desk. Rest assured that Senator Fasano, along with countless pro-consumer groups across the state, lobbied the Governor to come down on the side of consumers. Predictably, Governor Scott sided with Big Insurance.

After Governor Scott, the de facto leader of Mike Fasano’s political party, signed Senate Bill 408 into law, Senator Fasano refused to lie down and said the following:

“Big business has triumphed over the needs of the consumer,” Fasano said. “Insurance companies will only get richer because of this legislation while policyholders will have to pay more of their hard earned money for what will amount to less coverage.”

Unfortunately, due to term limits, Senator Fasano will be unable to run for reelection for his District 11 Senate seat in 2012. Though his time in the Florida Senate may be winding down, we surely have not seen the last of the Mike Fasano. I am confident Senator Fasano will keep up pressure on the insurance industry and all of those legislators who put the interests of their powerful lobby in front of their own constituents.

In the months before the January legislative session, I look forward to working with Senator Fasano, not only to fix some of the most egregious anti-consumer provisions recently signed into law, but also to draft new, pro-consumer legislation to protect against any further insurance industry overreaches.

You too can help in this fight. I urge you to visit PolicyholdersofFlorida.com and sign up to receive our newsletter as we develop more ways to fight for the rights of Florida’s 8 million policyholders. Frankly, it’s a fight this state can’t afford to lose.

Not only are surplus lines’ rates unchecked, the Florida legislature passed new laws last year that make most of the policy forms and coverages offered by these carriers not subject to regulations and consumer protections that are required of Florida's admitted insurance carriers. Many observers of Florida's insurance market may wonder why Florida legislators would give such a competitive advantage to non-admitted foreign carriers. I wonder why smaller insurers would not opt to operate as a non-admitted surplus line insurers when doing business in Florida?

Not all of Florida's legislative leaders appreciate Governor Scott's view of Citizens:

"He's clueless. The governor is clueless as to what is happening throughout the state, and the burden on homeowners and condominium owners and business owners," said Sen. Mike Fasano, a New Port Richey Republican who opposes most of the insurance legislation offered by the industry this year.

Rep. Jim Boyd, the insurance agent who filed the Citizens insurance bill largely written by the industry, said he did not share the governor's objective.

"Our goal is simply to return Citizens to the market of last resort," said Boyd, R-Bradenton. "I think there's always going to be a need for it, some property that can't be written by the private market." (emphasis added)

Making Citizens Insurance an insurer of last resort has some merit. For numerous valid reasons, many think that government should not compete with private markets except as a last resort. How to accomplish this certainly invites debate.

I imagine those working for Citizens may not have a feeling of job security given Governor Scott's views.

The "Clueless" comment by Senator Fasano sums up many of our elected leaders’ understanding of insurance law and policy. Some of the insurance laws that have been proposed will benefit only the financially strong insurance lobby. The lobby’s audience does not have the advantage of lengthy study of the industry or understand reasons why previous laws and regulations were made in the first place. The current Florida legislature has proposed laws that reverse decades of prior insurance law and regulations which were made to address valid needs and to protect consumers from companies that, time and again, proved they will not fulfill their ends of insurance contracts. For some reason, these purposes are not fully discussed by recent legislative staff reports and certainly not raised by insurance industry lobbyists.

As sad as it may be, when it comes to deep thought about the purpose and impact of insurance law, some of the rhetoric and thought found in the trailer to the comedy "Clueless" is far too similar to the thinking in Tallahassee:
 

State Senator Mike Fasano made an impassioned argument for the proposition that insurance companies must offer sinkhole coverage. Florida public policy and law has long mandated that sinkhole coverage is offered. Senator Fasano's district is plagued by this peril. In Senate Bill 408, proposed by Naples Senator Richter, the insurance industry successfully lobbied to make sinkhole coverage optional. Significantly, the law allows Citizens Property Insurance Corporation to decline to offer this coverage.

Senator Joseph Negron showed a remarkable understanding of the subtle nuances of coverage and why public policy requires mandated insurance coverage. Historically, many insurance companies refused to offer insurance coverage for perils associated with earth sinking or movement. This obviously caused problems in areas where sinkholes are common.

Senator Fasano pointed out that the banking industry requires coverage be provided for such common perils. He read a letter from a banking executive concerned that Florida regulations were slowly changing to allow insurance which does not cover the perils commonly faced in Florida. It suggested that the proposed law makes Florida a less desirable location to provide inexpensive mortgages because the collateral could be damaged without a financial backstop provided by insurance.

My impression from the questioning is the Florida Senate has bought, hook, line, and sinker, into the insurance industry's view of the world. Senator Alexander made a statement that reflected the insurance company view of how insurance should be bought, sold and operated. His view is not consumer friendly, and is widely shared in the leadership of the Florida Senate. Under this view, policyholders making claims for sinkhole losses are, without a shred of evidence, essentially viewed as frauds or bad people. Further, this view supports little or no insurance regulation. It believes that a free market will solve the insurance issues.

Historically, this view has met with catastrophe for policyholders and society. Free markets are far from perfect in some industries. We witnessed this in the banking industry just two years ago. Insurance regulation has long been allowed and required because the private insurance free market has proven it cannot work and has resulted in numerous insurer bankruptcies and illusory protections for consumers.

On the other side of the coin, Florida legislators are faced with a difficult insurance issue to which there is no easy answer. The statistics seem to indicate that many insurers have been losing significant money to the sinkhole peril. Some change seems needed. In the Florida Senate Banking and Insurance Committee, it has been pretty obvious that the insurance industry has successfully won the debate over how to accomplish that change.

A number of policyholders were given a very limited time to explain their plight. A firefighter whose home was damaged and whose insurer denied coverage, explained how the hairline crack grew and grew until he could see outside through the crack. He cannot get the $210,000 loan necessary to fix the problem. Senator Alexander left the room before his testimony.

One policyholder expressed outrage that elected officials were more interested with taking care of the insurance companies than the people who elected them. She explained that her mortgage company required her to keep sinkhole coverage. She noted that her front door would not open and her ceiling was falling, and the damage would not be classified as a sinkhole under the proposed law.

As predicted in Are Florida Policyholders With Sinkhole Losses Doomed Without Coverage?, SB 408 passed the committee. There was only ten to fifteen minutes of public testimony at each of the three committee meetings. Some policyholders drove from as far away as Key West and never had a chance to speak. The Senators gave about 15 minutes to State Farm's lobbyist and limited time to the remaining speakers.

Florida HB 803, filed by Representative John Wood, has the same language. If the insurance industry is permitted to exclude sinkhole loss as it did before the coverage was mandated, Florida homeowners will have no coverage for this peril. The proposed change in the law leaves every Florida family one tragedy away from financial ruin.

Touché Senator Fasano! As the meeting proceeded, and it got closer to 12, it was clear that a vote on the bill would be difficult. At about 12:04, a motion was made to end testimony at 12:10 and to vote at 12:14 (leaving 4 minutes for the Senators to debate the most sweeping insurance legislation in years). After this motion passed, the committee began to take testimony.

This is where it got very interesting. The first person to testify was a man from Pasco County who was a member of the United States Military. He described the damages that his home suffered from a sinkhole and the fact that USAA refused to pay anything because he “didn’t meet the definition.” At this point, Senator Olreich began a line of questioning that can only be described as demeaning. Asking the serviceman…how did you get USAA?; Who qualifies for USAA?; So everyone can’t get USAA right?: I don’t have USAA, etc. I still do not know what the point of that line of question was, but I do know that it came across as discourteous to everyone in the room. It was at this point that the Senators decided to temporarily postpone voting on the bill until the next meeting.

The next person to testify was a woman from Key West who described her nightmare of water intrusion and wind damage. She got emotional as she described her situation and the fact that she still had severe damage from the 2004/2005 hurricane seasons because her insurance company had not fully compensated her.

The last person to offer testimony was Michelle Beach from Key West who represented FIRM (Fair Insurance Rates In Monroe) and was told she had 3 minutes to testify. She spoke for about 1 minute before she was told that the meeting was about to end. She fired back and asked if she had been given 3 minutes or 1; the senators allowed her to continue for a few minutes before the meeting was adjourned.

I give that background to make this point – public testimony matters! There were several newspaper articles describing what happened at the meeting. There is no way that the press would have written about a Senate committee meeting in early February if that testimony had not been offered. Keep in mind, only three people were allowed to testify and it still had an effect. There were other people lined up to testify but they were not even allowed to speak. If we are going to have any shot at slowing down SB 408, we must engage our elected officials and get the press to pay attention. Judging from Monday’s meeting, we might be closer than we think.

At this point, the next meeting is not scheduled but I think it will take place the morning of February 22, in Tallahassee. If you can make it up there, or if you can get others to make it up there, it does make a difference!

Following the interview, I contemplated the issue of courage and whether our elected leaders and politicians have enough courage to stand up to the insurance industry and its political lobby. The insurance industry has essentially taken over the determination of insurance policy within the Florida Chamber of Commerce and Associated Industries. Its "soft money" campaign contributions are unsurpassed. Those of us with the ability and knowledge to challenge the powerful interests have a responsibility to help educate our elected officials and raise the prospect of intentionally misleading debate by these entities.

Standing up to illogical demands from those that support you financially can be difficult. When I write that the actuarial losses of sinkhole claims cannot be sustained in the long-term without changes to rates and/or changes in sinkhole coverage, I am certain some are not happy with that viewpoint. Yet, it is the truth and something must be done to change the current unsustainable situation.

What is not acceptable and seems to be the cowardly trend is the acceptance of untruthful and illogical reasoning for change of law or policy. "Fraud" is spewed from the mouths of insurance lobbyists and insurance propagandists as a basis for change. Few valid statistics ever support such charges. But using the word "fraud" as a false basis for insurance reform is as common as using the word "communist" was during the McCarthy era of the 1950's.

I was amazed that nobody in the Florida Senate Banking and Insurance Committee challenged the derogatory comment made by one insurance executive testifying that sinkhole losses are a form of "blue collar lottery." Such defamatory rhetoric is used to cast unfair suspicion and impugn the integrity of anybody making such a claim and those that provide help doing so. Senator Mike Fasano was a noted exception to the acceptance of such rhetoric. Other senators were not taking a stand nor did they have the courage to challenge the statement. The media simply repeated the pithy, but false charge. A problem with outcome oriented public policy agendas is that many have no logical basis for implementation. They can be quite destructive. McCarthyism and the absolute proof of Iraq having weapons of mass destruction are examples what a delusional basis can do to influence politicians.

Similarly, "fraud" and "lottery mentality" are the false codewords used by the insurance industry and its lobbyists to support its outcome oriented agenda. Whenever they are mentioned, elected officials and regulators should question whether there is a truthful and legitimate reason for the insurance industry's request for alleged "reform." The courage to demand a honest debate rather than support of a position and vote pre-determined is needed if we are to improve the insurance marketplace.

[T]his bill, he said, is deadly to consumers. A bill like this, he said, would never have come forward under governors Jeb Bush or Charlie Crist, but with uber-business friendly Rick Scott leading the state, legislators are feeling emboldened with a bill that is overly generous to the insurance industry. "It's scary," he said.

My impression of the proposed legislation was noted in Draconian Property Insurance Bill Filed in Florida Senate. Deadly, scary and draconian sound pretty bad for the consumers of insurance. I wonder why others don't see it that way?

I think Fasano answered that question in the above quote. Some in our Legislature feel the insurance industry and its concerns are paramount to the interests of many policyholders. There seems to be little listening to reason and good public policy from the consumer's view. Hopefully, the debate will change and honest reflection through study of issues will occur. Otherwise, Mike Fasano's prediction about the impact of these proposed insurance laws as currently written are the same as mine.

The article bluntly states its findings:

A Herald-Tribune investigation finds Florida's largest insurer has...found an easier way to profit from homeowners desperate for coverage. And the desperation State Farm helped create allows it to command some of the highest rates in the world.

 The conduit for this back-door insurance is DaVinci Reinsurance Ltd., an offshore company with no physical office or employees of its own that sells policies to insurers to cover their storm losses.

 The virtual corporation was launched in 2001 by State Farm and a Bermuda reinsurer with which it has close ties.

 State Farm provided $200 million in seed capital. Its partner, RenaissanceRe Holdings Ltd., took on management and the recruitment of other investors.

 While it has little physical presence, DaVinci is now one of the state's most important hurricane reinsurers. Contracts show DaVinci provided coverage last year to more than 50 Florida insurance carriers representing the owners of 3.7 million homes.

 Through DaVinci, State Farm quietly continues to collect money from thousands of former customers who were told their homes were too risky to insure.

I remember Florida legislators grilling Florida's Insurance Consumer Advocate, Sean Shaw, last year about "free markets." I bet they were provided scripts by State Farm and other insurance industry lobbyists to ask those questions. And all the while, the market was being secretly manipulated by the insurance companies that wanted no regulations so rates could go sky high. It is disgraceful to indicate that Florida has a "free market," when it comes to insurance rates because it is manipulated in so many ways by the insurance company participants.

I know a number of Florida leaders who stood up to the insurance industry propaganda last year. One was Florida Senator Mike Fasano, who is always skeptical about the rates charged by insurance companies. Here is what he reportedly had to say:

State Farm has done a good job, an excellent job, in pulling the wool over the eyes of many of my colleagues in the House and Senate," said state Sen. Mike Fasano, a Pasco County Republican and a critic of State Farm.

Senator Fasano may be "on the outs" with Florida's Republican leadership because he loyally stuck to his commitment to Florida's Governor Charlie Crist, who switched political allegiance from Republican to "independent" in his failed race to become a United States Senator. It will be interesting to see whether Florida's other legislative leaders are going to be bought off by the insurance industry and its agenda or have the courage of Fasano and do something for Florida's insurance consumers.

I met with a number of Florida's Senate and House leaders on insurance issues last year. I plan on doing the same in Florida and Texas in 2011. The insurance industry and its lobby keeps much of its true agenda secret. Those speaking for them use propaganda, such as everybody's belief in "free markets" or "freedom to contract" as methods to appeal to basic notions of American values and fairness. Unfortunately, each of these notions are manipulated secretly or after the fact so that insurance laws and regulations are rigged for the insurer and against the consumers of the product. Insurance companies have an army of propagandists, often lawyers and public relations or academic types, that write editorials or get articles published by ignorant journalists.

The investigative work done by true journalists, such as Paige St. John, does not come cheap. In an era when media has little money to uncover the truth, it is refreshing to find journalists who will spend time and reveal the truth regarding such an important product dominated by such powerful interests.

I hope our leaders will learn for this journalism. I hope they remember that they were elected to serve their constituents and not those powerful insurance companies with large soft money campaign contributions. And while I hope, I am not naive.

Julie Patel, of the Sun Sentinel covers the “insurance beat” and has a good understanding of the issues because of her experience reporting on insurance related issues. Her blog had a recent post, Bill Allowing Insurers to Raise Rates Likely to Get Vetoed by Crist. She noted:

Gov. Charlie Crist said he's leaning toward vetoing a property insurance bill that would, among other things, reduce costs for insurers and make it easier for them to raise rates.
…
"To their great credit, they're very effective advocates," Crist said of insurers. "They play on fear a lot and talk about, 'It's going to be a terrible day.'"

I agree. Indeed, I noted the effective control the insurance lobby has in Tallahassee over a year ago in Insurance Lobbyists are Winning the Consumer Protection Battle, and more recently in The Florida Insurance Lobby Currently Controls the Rhetoric Regarding Public Adjusting in Florida. Since much of what the insurance industry is paying for with these lobbyists are laws that harm their own consumers, even the pro-insurance industry press has questioned whether this is ethical-- as noted in The Ethics of Insurance Industry Lobbying is Raised in the Insurance Industry Press . In effect, the insurers are using premiums from their own customers to pay lobbyists to promote higher rates and fewer benefits for their customers. One aspect of the proposed legislation does exactly this. Now that the bill has hit the governor’s desk, everybody can bet that these savvy insurance lobbyists are trying every trick in the book to suggest that this bad legislation is helpful to consumers. The media propaganda has started in earnest with “Florida Insurers Say Omnibus Property Bill Is Consumer Friendly.” After spending all that money with the legislative process, those lobbyists will have their public relation types doing everything they can to make this bad bill look as good as possible.

Still, in Five Bills Gov. Crist Should Veto, the St. Petersburg Times editorial board noted:

Property insurance (SB 2044) This bill is a mixture of bad and good, the latter being that it would require insurers to have more capital. But it broadens the ability of insurers to get expedited review for rate increases of up to 10 percent to cover reinsurance and inflation costs. The window for these types of increases, which are routinely approved, is plenty wide enough now.

The legislation also unfairly tinkers with mitigation discounts. It penalizes both those homeowners who invested in storm shutters and other improvements and homeowners who did not — lessening the cost of mitigation discounts to insurers and allowing them to transfer some of the remaining costs to other homeowners.

Indeed, I was at the legislative hearing regarding the discounts, where Senator Mike Fasano seemed very upset that Florida, after promising insurance rate discounts and people spent money on mitigation measures in reliance on that promise, would retroactively break that promise.
 

There are more aspects of the long bill which I will write about. I did promise in yesterday's post about commenting about one aspect of it involving religion, and here it is:

Section 5. Paragraph (n) is added to subsection (2) of section 626.221, Florida Statutes, to read:

626.221 Examination requirement; exemptions.—

(2) However, no such examination shall be necessary in any of the following cases:

(n) An applicant for license as a customer representative with respect to property insurance who has earned the designation of Certified Insurance Representative (CIR) from the National Association of Christian Catastrophe Insurance  Adjusters.

While a Christian, I believe in separation of church and state. Nobody I know in the insurance adjusting community has ever opined that membership in this particular organization renders an adjuster more educated, experienced or qualified to do the job. The qualifications for membership in the Christian one, the National Association of Christian Catastrophe Insurance Adjusters, certainly do not meet the level of experience and knowledge required of a CPCU or AIC in adjusting.

I wonder what my Jewish adjuster friends think of it?

Let me give you an example of what every claims adjuster would recognize as complete stupidity in the insurance world and that insurance lobbyists provided as an analogy to support their position that 20 year old roofs should be separated out of the replacement cost coverage. A lobbyist explained that their proposed law allowed insurance companies to take depreciation on old roofs even under a replacement cost policy. He said this was just like a situation where a five year old car is wrecked and the insurance company replaces it with a five year old car rather than a new car. Now, most of the people reading this Blog know that is a ridiculous and misleading example when applied to real property loss. The reason why is that you cannot buy a five year old roof. There is no ready market of five year old roofs to purchase. And, there is no ready market to purchase five year old nails, shingles, tiles, and whatever else is needed to repair a five year old roof. Indeed, finding and acquiring five year old parts as a replacement will be a lot more expensive than using new materials.

An insurance industry lawyer-lobbyist told the Senators that before the 2006 Replacement Cost Laws that require insurers to immediately pay replacement costs for policyholders who purchased replacement cost insurance, Florida did not require claims repairs to be paid that way. Instead, according to that lawyer-lobbyist, under actual cash value principles, insurers could hold back depreciation before repairs were made. Wrong again. Florida is one of many states that require "repairs" of structures on an actual cash value basis to be made without depreciation taken. Glens Falls Ins. Co. v. Gulf Breeze Cottages, 38 So. 2d 828 (Fla. 1949) In Glens Falls, the Florida Supreme Court decided this very issue:

When insured structures suffer damage far less than total loss, appropriately compensable only by repair, is the measure of indemnity the cost of repair, necessary to render the structure habitable, rather than cost of repair less depreciation?

The discussion of this longstanding Florida law that all adjusters learn was strangely similar to the discussion taking place in the Senate hearing room. I wonder why the insurance lobbyists did not tell the Senators about it and its very sound logic followed by many states when considering how much must be paid when partial repairs are made? The Court noted and found:

The appellants urge us to make a distinction between the damage to a roof and to other parts of a building, going so far as to say that no contention is made that depreciation should be allowed on repairs to the ‘main portions' of a building damaged by windstorm; that even though the other parts of the building repaired after damage from a storm would be in better condition than before repair, nevertheless the insurer should not be relieved of his duty to make those repairs. Of course to the insurer there may be reason, from a practical standpoint, why the roof of a building might fall into a separate category, that being the part of the building which always feels the full force of the elements, but we must take into consideration the protection which is sought and granted when an insurance company contracts with an owner of property to insure him against loss.

The appellants and the appellee agree, and the chancellor announced, that the contract was one of indemnity. Appellants themselves in their brief concede that in the case of partial loss it is the duty of the insurer to restore the property to its condition prior to the loss (if the cost of doing so does not exceed the amount of the insurance), although the cost of doing this ‘is proportionately more than the amount of damage bears to the value of the insured building.’ Appellants do not dispute the soundness of that rule. In a contract of that character the companies undertook to save the owner from harm caused by ravages of storm, and we think the responsibility obtained without distinction between the roof and the remaining components of the structure. We are not referred to any provision of the contract making any such distinction.

Since the buildings were only partially destroyed, it was all the more necessary, for the reasons we have given, that the roofs should be in good condition in order that the structures might remain habitable, and there seems no occasion for holding that, although the repair of other parts places them in better condition than they were before the damage, a different yardstick should be employed in measuring the amount due for the repair of roofs.

Bearing in mind that the purpose of the contract was to indemnify the owner against loss, we think...that the property should have been placed in as nearly as possible the same condition that it was before the loss, without allowing depreciation for the materials used. Certainly it was not intended that the repairs should be made with materials which were not new. If depreciation were allowed, it would cast upon the owner an added expense which we do not believe was contemplated by the parties when they entered into the insurance contract.

The Florida Supreme Court therefore followed the line of reasoning that actual cash value of partial losses to real property is the amount to repair without depreciation, limited by the total amount of available insurance. It would be a strange quirk if the Florida legislature not only receded from its recent 2006 laws, but, in doing so, took away seventy years of common law protecting insurance consumers---and have the nerve to call the proposed law a consumer protection bill.

Legislators would be well served if they removed insurance industry lobbyists from their "trusted" advisors and only partly for the example I just provided. These insurance lobbyists use conservative principles as "spin." They package anti-consumer laws that will harm Floridians using phrases that appeal to conservative values, although the laws are illogically anti-consumer, but "sound good." For example, who is against the "free market" or "competition?" Nobody. So, every time these insurance industry lobbyists propose a law, they package it in such terms, although the terms do not apply. Conservative legislators should be outraged that the insurance industry lawyers and lobbyists are misappropriating the terms that describe conservative core values and using them to mislead the legislators into supporting laws that truly do nothing to foster the free market or competition, but only hurt their constituents. Conservative legislators and constituents should be further outraged that these lawyers and lobbyists have such inroads into our democratic process because of enormous wealth and resources.

Still, I must apologize if my rhetoric is too harsh regarding our elected officials . I can be as guilty as anybody of getting excited about an issue. I truly meant the following I posted in The Florida Insurance Lobby Currently Controls the Rhetoric Regarding Public Adjusting in Florida:

Everybody reading this should remember a few important aspects about our democratic process, the need to participate, and the need to reform when criticism is warranted:

1. Most elected officials truly want to make the "world, country, state" a better place to live and work. They are not corrupt, but are truly well meaning people.

2. Politicians viewpoints on issues are often ignorant because nobody knows everything. If full-time insurance lobbyists show propaganda to these elected officials that only shows that policyholders are getting something they do not deserve... you do not need to be a genius to appreciate their impressions and viewpoints.

3. Many insurance companies require and train their employees and agents to speak with elected representatives about issues in such a way to slant impressions to elected representatives about the need for laws that protect insurance company interests over consumer interests. They often have these scripted out as talking points so that the propaganda actually makes it sound like the proposed law is in favor of the policyholder---usually through the promise of lower rates which then never materialize or do so at the cost of not having coverage.

4. Unless interested people take an active role to visit with, write, and support representatives that appreciate the truth and the need for policyholder protection, the full time lobyists and employees of the insurance industry will prevail with their message.

5. You have to participate if you want justice to work in a democracy because large corporate interests have already figured this out and spend massive money and time coordinating special interests by industry.

...

7. Show up and support representatives that appreciate the consumer side of insurance. You need to encourage and provide financial support to consumer organizations...

8. If you want justice, you cannot just sit back and expect others to do it all for you. You have to work at it with your time and money. Make a commitment and stick to it. If it is important enough, make a big commitment and encourage others. One person can make a difference.

9. Do not get discouraged. I have visited with and provided information to various representatives for a number of years. Sometimes, I have felt like it is just me, a few lobbyists I have personally hired because I have to work on my cases, and just a handful of others in Tallahassee trying to push for laws that favor consumers...I feel as if I have wasted a significant amount of money and time while some other colleagues simply do nothing and provide no support. And, I still keep at it.

In contrast, the insurance lobbying effort is massive, professional, and full time. They can outspend and provide greater numbers of individuals in their efforts.

And, policyholders cannot give up because the alternative is unjust laws. Those well meaning political representatives understand the enormous wealth and resources of corporations. Contrary to popular rhetoric and demeaning criticism, most elected representatives are not "paid off" or "corrupt." They will listen if you can present a credible and persuasive impression that is based on genuine and authentic truth of an issue.

I enjoyed providing some of my knowledge and explaining my appreciation for insurance to our elected representatives yesterday. Insurance is a wonderful man-made financial product. The issues before the legislature are not easy. Insurers need to make a profit and we need to develop a larger supply of available insurance. Doing that and providing an affordable product that pays fully and promptly demands lawmaking based on truth, logic, and knowledge.

In a National Underwriter article, "Gov. Crist Says No To Proposed Insurance Deregulation Bill," Crist was on record as saying he does not support the current rate deregulation bill. Consumer groups agree with the Governor:

"The consumer groups reacted favorably to the news. Consumer Federation of America’s (CFA) director of insurance, Bob Hunter, said in a statement, “It is outrageous to claim that this bill falsely promises ‘consumer choice,’ when its purpose is to let insurance companies charge whatever high rate they want with no consumer protections in a market with virtually no competition. The bill is an insurance industry wolf wrapped in consumer-choice-like lamb clothing.”

Birny Birnbaum, executive director for the Center of Economic Justice (CEJ), told NU Online that the bill is similar to legislation that passed the legislature last year but was vetoed by Gov. Crist.

That bill would have allowed homeowners insurers to charge rates not approved by the OIR if they met certain surplus requirements.

Mr. Birnbaum called this year’s bill a “little more far-reaching,” as the capital level limits in last year’s bill do not apply.

“It’s unclear what you’re trying to accomplish with a deregulation bill,” Mr. Birnbaum said.

He noted that the Florida market has shown that it is not competitive, and so competition and market forces will not lead to favorable prices for consumers. Regulatory oversight, he stated, is the only thing protecting consumers from excessive rates."

Birny Birnbaum and Bob Hunter are just about the smartest people I know who are not employed by the insurance industry when it comes to understanding insurance rates. Florida legislators who want to do "the right thing" for Florida and their constituents should listen to them. Governor Crist and Senator Fasano have listened to these scholars and read what they have written about this proposed legislation and that is why their views make a lot more sense. Other legislators are adopting the insurance lobby’s attempts to "spin" this craziness into law and policy.

I like and respect Senator Mike Fasano. He worries about the people without a lot of financial means. He is a good public servant who is not trying to use his office for personal financial gain.

While we see eye to eye on many issues, I respectfully disagree on the issue of allowing policyholders to "opt out" of sinkhole coverage. It is a very risky proposition--like opting out of "cancer treatment" to save on health insurance premiums. Chances are you won't get it. But, if you do.....

I also think the legislation leads many Floridians into violating most mortgage agreements. Sinkhole coverage is available and most mortgages require broad all-risk coverage to be purchased. I have heard some claim that the banks will purchase sinkhole coverage as "forced placed" and charge a significant amount back to the policyholder anyway. So where's the savings in that scenario?

And, aren't we just begging for people that get stuck with slow moving sinkholes and no coverage to walk from their properties? The properties will not get fixed. Lower property values and blighted neighborhoods will also result from legislation. In this scenario, even the people who did not purchase sinkhole coverage lose. Neighbors are financially harmed when others are allowed to be cheap.

The sinkholes will continue. Many are tempted into a significant gamble of not paying some money today in return for an unlikely financial disaster tomorrow. Fasano's legislation makes many policyholders into gamblers with the financial bet of their lifetimes.

Still, I understand Fasano's concern. If people are driven from their homes because of escalating insurance costs and from other non-discretionary expenses, there is another real social problem. This is especially so for the fixed income retirees in his district. He made a choice and felt this was his best, possibly only, option to combat that issue. I suggest he keep working on other alternatives.

I disagree because he equates "savings" of premiums without also taking away the total impact of policyholders not having insurance when the "big one" starts destroying their nest egg investment. He should also factor the total impact the legislation has on all our property values when people walk away from or cannot fix their sinkhole damaged homes. My guess is that if he made such a calculation, the positive number he cites in the following discourse with the Tampa Tribune would be a large negative loss for individuals and our community at large.

Choice in sinkhole coverage

The Tampa Tribune
Published: October 24, 2009

Regarding "A sinking feeling in Pasco and Hernando" (Our Opinion, Sept. 28):

I disagree with your claim that "property owners in sinkhole-prone Pasco and Hernando counties are getting shafted by the governor and the Legislature." Allowing residents in these two counties to choose for themselves whether they want full sinkhole coverage or catastrophic ground cover collapse coverage gives them economic freedom that was previously prohibited by law.

When I sponsored legislation in 2007 to allow Citizens Property Insurance Corp. customers the option of choosing to drop full sinkhole coverage, it was because insurance rates were extremely high in these two counties due to the number of sinkhole-related claims.

Residents who live in areas that were not sinkhole prone were stuck paying the same rates as those who were more likely to experience sinkhole activity. This was not a "stunt" as you proclaim but an opportunity to give people more choice and control over the decisions they make based on their budget situations and geographic location.

At my request, Citizens supplied some information to demonstrate just how successful the sinkhole option has been. As of June 30 of this year Citizens had a total of 43,881 policies written in Pasco. Of those policies 80.5 percent of homeowners chose to exclude sinkhole coverage. This resulted in a total premium savings of $38,792,481.

During the same period, a total of 22,014 homeowners were covered by Citizens in Hernando County. Of that number, 65.5 percent of residents chose to not purchase full sinkhole coverage. This translates into a savings of $12,417,368.

Combined, homeowners in both counties saved $51,209,849 in premiums.

The $51 million saved in premiums are dollars that remained in the pockets and bank accounts of everyday people. Many of these individuals are seniors living on fixed incomes, families struggling through tough economic times and those trying to make ends meet week after week.

This past spring the Legislature passed a bill that allows private companies in Pasco and Hernando counties to do what Citizens was given the opportunity to do in 2007. With the possibility of premium savings being in the millions of dollars, the "stench" and "scheme" you call this legislation is totally unfounded. I doubt any resident who chooses to have their premiums nearly halved would argue in favor of being forced to keep full sinkhole coverage.

Mike Fasano of New Port Richey represents District 11 in the Florida Senate

The article quoted Barney Bishop, the Executive Director for Associated Industries of Florida as advocating the following:

Florida insurance regulators are failing in their duties if they don't make the state-backed Citizens Property Insurance Corp. raise property insurance rates by 10 percent across the board, a business group lobbyist said Tuesday.

Barney Bishop III, president of Associated Industries of Florida, said it's ''astonishing'' that the state-backed insurer would not increase rates on all policies by 10 percent.

''It is our position that every rate should go up,'' Bishop told representatives from the Office of Insurance Regulation. ''The rates haven't been actuarially sound for the last five years.'

In response, Belinda Miller of the Florida Office of Insurance Regulation disagreed:

Miller argued the 10 percent was a cap set by lawmakers and not intended to be applied equally to all Citizens' policy holders.

''We don't want to increase rates too quickly because people would have a hard time paying for it.'' Miller said. ''Nor do we want to have a rate that is not adequate to pay their claims. Our concern is to make sure that this strikes the appropriate balance.''

This is a topic that Belinda Miller knows very well. She served with me on the Citizens Property Insurance Mission Review Task Force. I wrote about this issue last January in Headlines And Reality. There, I wrote:

The Citizens Mission Review Task Force made a significant recommendation at its meeting on Tuesday. Prior testimony was that the average Florida rate hike, which would be approved by the Office of Insurance Regulation, would almost certainly be higher than 30%. We recommended to the Florida Legislature that they to pass a statute to cap that rate increase at 10%. Without this law, the rate would probably go up over 30% on a statewide basis.

So, what do you think a proper headline would be in a newspaper article reporting on this outcome? Panel Votes to Cap Rates. 10% Maximum Rate Increase Proposed. How about, Panel Says No to Unlimited Rate Increases?

By Jingo, no way! Newspaper editors must think they need headlines full of sensationalism and fear to catch a reader’s attention. These were some of the headlines I found on a Google search Wednesday morning:

• Citizens Property Insurance Plans to Increase Rates
• State Panel Backs Rate Hike of up to 20 Percent for Citizens Insurance
• Citizens Should Hike Insurance Rates, Task Force Says
• Hike Citizens Property Insurance Corp's Premiums, Florida Panel Urges

We never found that the rates should be hiked. Instead, a bunch of experts explained why they thought a "fair" rate was going to result in a huge increase because Citizens has been charging an amount of premium that is not "sound." Even the Florida Office of Insurance Regulation indicated that a fair rate for Citizens was one that could have an increase above 30%.

In 2006, the Florida Legislature froze Citizens rates to combat skyrocketing premiums. The Legislature then passed a law mandating that Citizens had to charge "actuarial sound rates" by January 1, 2010.

I never voted to raise rates. I advocated and then argued for the cap because I felt it was going to make insurance unaffordable for many if the rates jumped overnight.

It is obvious that Belinda Miller is correct and Barney Bishop is spewing the propaganda of the insurance industry that is a big supporter of Associated Industries. The entire debate and method contemplated that overall rates would go up, but it would vary.

What is happening is that lobbying organizations supporting the insurance industry have already paid significant monies to the leaders in the Florida legislature. Now, they have to start raising the issues important to them for the next legislative session. Those lobbyists cannot come out and say, “hey, we paid you all this money to have dinner with you, go to golf and raise money for your next campaign, so vote our way.” That would be stupid because those legislators would be any “easy mark” for being in the pocket of those lobbyists. Then, what would they say to their electorate?

The smart way to do it is to have people like Barney Bishop say that the problem is Citizens not charging enough. Public relations experts have people like Barney Bishop also change the debate to one of “free choice” so that State Farm and others will no longer have to worry about getting approval for a fair rate. It is all part of the charade to allow many bought and paid for legislators to vote in a demanded manner by the insurance industry.

It is fortunate that some leaders in Florida, like Governor Crist, remember the public promises they make to the people are far more important than privately taking excessive amounts of campaign money from huge insurance corporations knowing that clandestine public relations campaigns will be run by those corporations to mask the private “deal” made with the devil.

I am going to propose to United Policyholders or other consumer groups that we try to find out who is taking the money and disclose which politicians have switched their votes since 2006 to allow rates to go up. They might as well be honest about it the next time election time rolls around.

My longstanding view is that “hardening” of structures is important public policy for coastal states. It should be encouraged and reflected in rate regulation, building codes, and taxation policy. The best loss is one that does not happen. The second best loss is one which is less severe as a result of preventative measures.

On Thursday, the Florida Office of Insurance Regulation issued a letter responding to State Farm’s requests for the elimination of certain discounts. It approved many, but also called for State Farm to provide greater information regarding the issue of eliminating or reducing rates for those who “hardened” buildings in return for lower premiums:

“The changes to State Farm Florida’s mitigation credits contained in this file are not approved. As discussed on prior occasions, an alternate mitigation credit is allowable under Florida regulations; however, such credits must be supported by a “detailed study” pursuant to Section 69O-170.017, Florida Administrative Code and other pertinent regulations. If State Farm Florida chooses to file alternate mitigation credits in accordance with the rule, the study of the alternate credits may best be performed by the proprietor of the model to ensure explicit documentation as provided in the current approved ARA study. Some items of significance that should be addressed in the study, if one is conducted, include but are not limited to:

1. Explicit documentation with respect to the reflection of all code wind speeds.

2. Explicit support for the selected base structure. This should include an explanation of how it complies with Section 627.0629, Florida Statutes and the following data:

a. The expected hurricane losses in total
b. The expected hurricane losses for each group of discount features
c. The expected hurricane losses for policyholders receiving no discount

3. Discounts must reflect all features that reduce windstorm loss. Further, areas with a higher resistance to wind speed must reflect higher discounts.

4. Include detailed support to show base rates are consistent with the base risk that is not receiving mitigation discounts.”

The important thing for everybody to notice in the Miami Herald article is that State Farm is not the only insurance company behind this. A number of elected officials who cater to the insurance industry and Citizens Property Insurance Corporation (which is part of the Florida Government) obviously conspired with others to break the promises made to Floridians:

“…more than 700,000 other Florida consumers who spent big money to fortify their homes -- could see their ``wind mitigation'' discounts dramatically reduced.

Insurers, led by State Farm Florida, are complaining that the discounts for installing shutters and other protections have become so popular that they are undercutting the industry's bottom line.

Last year, citing the cost of the discounts, State Farm asked for a 47.1 percent rate increase. The state said no, but the Legislature agreed to review how the discounts are tallied. The first public hearing is Wednesday in Tallahassee.

Bressner thinks it is ``counter-intuitive'' for insurers to want to strip away incentives that encourage policyholders to make their homes better able to withstand a windstorm.

State Sen. Mike Fasano, R-New Port Richey, who serves on the Senate's banking and insurance committee, recalled State Farm's president testifying on behalf of the discounts.

``This is what they wanted and this is what they got,'' Fasano said. ``Now they want to take away [the discounts] from homeowners. That's a promise they've broken.''

Still, lawmakers are willing to listen to the industry.

``We want to be sure that the discounts we're offering are right,'' said State Rep. Bryan Nelson, the Apopka Republican who sponsored the law mandating the review.

``We're reducing premiums every year,'' said Carol Everhart, a member of the governing board with Citizens Property Insurance, the state's largest insurer. ``But what we're doing isn't based on a valid study.''

If our elected officials and those regulating our insurance industry in Florida want to know what the insurance industry hopes to gain from this new maneuver, now and in the future, they should request records from Citizens Property Insurance Corporation, which is a governmental-not private-entity. They should ask for Citizens’ officers and managerial employees to explain all their discourse with other insurers, legislators and lobbyists regarding this topic for the past several years.

We should also applaud all the elected representatives that stand up to the insurance companies. Before the next election cycle, I plan to draft a detailed outline for everyone to review that delineates which elected officials in Tallahassee are really for policyholders versus those who work for the insurance industry. The advertisements by some politicians were completely fraudulent on this last year. It’s about time that the local electorates understand who really works for them and who works for Big Insurance.

By electing Frank Artiles, a Florida public adjuster, for the Florida House of Representatives in South Florida, I don't see those kinds of things happening. My law firm is dedicated to helping this become a reality, and we need your help.

On Thursday, August 13, we are co-hosting a fundraiser for Frank Artiles with Miami-Dade County Commissioner Jose “Pepe” Diaz in our Coral Gables office from 6 pm to 7:30pm. Frank is a wonderful person and will make a devoted public servant. We need more bright individuals like Frank Artiles in our legislature who are willing to stand up for the average insurance consumer as Senator Mike Fasano does.

The Merlin Law Group is also presenting a continuing education seminar for public adjusters earlier the same day. At 4:00, I will make an hour-long presentation, Ethical Issues in Presenting Claims. I expect this class to be very interactive, as they usually are when a roomful of public adjusters come together to learn and share with fellow professionals. I have applied for 1 ethics credit for public adjusting continuing education for this class. The following topics are on the agenda:

• Unauthorized/Unlicensed Practice of Law: How to recognize it and to ensure you do not do it

• Unauthorized/Unlicensed Public Adjusting: The legal ramifications of contractors and others associated with the building trade who are not licensed public adjusters and who negotiate insurance recoveries with insurance adjusters

• Code of Ethics: Discussion of the public adjuster's ethical requirement to "put the duty for fair and honest treatment of the claimant above the adjusters own interests in every instance."

• Public Adjusting Contracts: Discussion of waiting periods, signing proofs of loss, appearing for EUOs, excessive fees, and all questions you may have on these topics.

The seminar is in the Westin Colonnade Hotel immediately adjacent to our Coral Gables office. We will host a cocktail party/fundraiser thereafter in our Coral Gables office at 6.

Everybody is welcome to attend the fundraiser. All public adjusters along Florida's east coast should make their way down that afternoon for education, political support, and fun.

You never know what can happen in life until you try. We need your help on this endeavor for Frank.

Public Adjusters can register for the Ethics Seminar by clicking here.

One of the sad realities about elected legislators is that some are simply not able to understand issues. Like deer in headlights, some have agendas but little ability to logically comprehend competing issues and analyze the crucial impact laws will have if not drafted precisely. Happily, Mike Fasano is not one of those legislators.

You should never pre-judge a person's ability to reason by the lack of formal education. Mike Fasano did not graduate from a traditional high school, due to problems after the death of his father. His very humble background is apparent in his concern for those that are less affluent. Many of his constituents are retired and on fixed incomes. When you consider his background and the demographics of his electorate, it is no wonder his primary insurance concern is that it is affordable and not a sham—meaningful insurance is necessary for the elderly and disenfranchised.

Fasano told me of a couple that had worked hard to pay off their mortgage. Unfortunately, they let their insurance lapse and their house suffered a severe uninsured loss. I told him that I have seen that scenario many times and that there is some value to the mortgage escrow requirements which require property owners to pay for insurance and property taxes. Some simply lose the premium or tax notices or forget to pay bills. It happens a lot more after some reach that goal of paying off the mortgage.

My impression is Senator Fasano could have been a priest or involved in some other charitable endeavor for his fellow brother and sister. He never mentioned any concern other than for the working class, the elderly, the retired, and how others in business or government could help protect them. While I have seen his contempt for others in some public hearings, in my interview with him, he expressed only interest in helping our State and its citizens and without a harsh word.

After meeting and spending time with Senator Fasano, I can appreciate why his constituents vote for him. He is dedicated to helping them and experienced enough to understand how he can help them. In the future, I expect Mike Fasano will find some other noble means to help people rather than use his talents for personal financial fortune or fame.

As am I, he is a strong supporter of Governor Charlie Crist, Senate President Jeff Atwater, and Insurance Commissioner Kevin McCarty. It would not surprise me to find him working in Washington, D.C. someday. Until then, I will try to provide him my understanding of insurance as he battles through those various complex issues. At least he appreciates and understands the difficulty of these issues which some of his elected colleagues simply do not.