Over the course of the last several months, insurance lobbyists have worked closely with state-run Citizens Property Insurance on a deal that would effectively subsidize the profits of a handful of large private carriers.
If you’ve been paying close attention to the local and state section of your newspaper, you may have seen the story – Most Floridians, however, have not.
This deal was unveiled last month and quickly voted through Citizens’ board despite objections from lawmakers from both parties, the Office of Insurance Regulation, and the state’s Insurance Consumer Advocate. The plan calls for Citizens to loan up to $350 million to private insurance companies under sweetheart terms and was hastily rushed through the approval process with little input from the public or other stakeholders.
The story might seem familiar.
This is the latest in a troubling series of attempts by the appointed members of Citizens’ board to usurp the role traditionally played by the legislature – an elected body which answers to voters across the state.
By using Citizens’ massive $6.2 billion in reserves to provide low-interest loans to private insurers, effectively subsidizing their profits, the deal would turn the state run insurer of last resort into the insurance industry’s piggy bank of first resort.
This isn’t the first time the state has tried to subsidize the private market with reserves meant to help after a storm.
Not surprisingly, the insurance industry’s lobbying groups that helped draft the proposal applaud the deal and urge for passage – quick and dirty.
A group of insurance industry supporters including Sen. John Thrasher (R-Jacksonville), Rep. Bryan Nelson (R-Apopka) and business trade group President and former speaker of the Florida House Tom Feeney urged Citizens to pass the program “with all due haste.”
Opposition to this unnecessarily rushed approach has ballooned since the story first broke with incoming speaker of the Florida House Will Weatherford (R-Land O Lakes) urging for a second look.
In a letter to Citizens’ Chairman of the Board Carlos Lacasa, Weatherford expressed genuine concern about the approval process. Weatherford wrote that his “concerns involve serious questions regarding the process by which the proposed program was approved, the sufficiency of the information and analysis on which the approval was based, and uncertainties regarding the Board’s legal authority to adopt and implement the program.”
Incoming Speaker Weatherford is right to question this half-baked scheme. Thanks to his leadership on the matter, as well as the vigilance of Insurance Consumer Advocate Westcott, Representative Frank Artiles, and Senator Mike Fasano, the plan will get another look. In fact, just yesterday, Citizens’ Chairman Lacasa issued a letter stating that an independent firm will undertake an outside review of the program.