An insurance agent leader in the Florida Association of Insurance Agents has questioned Florida’s dominant insurance rating agency’s motive to downgrade Florida-based insurers. A post to its membership suggests that Demotech made the downgrade for a self-serving financial reason as a power ploy:
Are there ulterior motives for the timing of these downgrades? For years, Joe Petrelli has unsuccessfully tried to convince Fannie and Freddie to accept Demotech’s ‘S Substantial’ rating. Does downgrading a large number of companies primarily operating in Florida, one of the largest insurance markets in the world, provide the leverage he needs to get approval?
Wow! That would be quite a plan if true. Bully the federal mortgage lenders by threatening Florida’s fragile insurance marketplace. What the heck—maybe Demotech will enlist Governor DeSantis to take on this cause the same way DeSantis took on Walt Disney World.
This adds a new wrinkle not mentioned in yesterday’s post, Shocking! Shocking To Believe That Any Insurance Regulator Would Rely Upon Demotech. Insurance rating agencies are not something property insurance coverage enthusiasts spend much time studying. Maybe we should, based on the most recent drama involving the Florida insurance marketplace.
Thought For The Day
The moment there is suspicion about a person’s motives, everything he does becomes tainted.