Letter to Governor Charlie Crist Regarding HB 1171 “The ‘Consumer Choice’ Bill”

Dear Governor Crist:

I am writing to strongly encourage you to sign HB 1171 into law.  This bill, rightfully dubbed the “consumer choice” bill, would greatly expand property insurance options for consumers in Florida.

As you know, HB 1171 would allow Floridians to choose between rate-regulated carriers and a narrowly-defined group of well capitalized, mostly nationally recognized insurance carriers.  Although it exempts the latter group from rate regulation for excessiveness, the bill does not affect the state’s ability to regulate against unfair discriminatory practices, insolvency, and insufficiency.  Furthermore, this bill does not affect the state’s authority to disapprove a rate filing should the Office of Insurance Regulation find that a carrier arrived to such a rate in an unlawful manner.

The bill also educates and protects consumers by requiring them to sign a form acknowledging their understanding of the type of unregulated policy they are purchasing and obtain a quote from a rate regulated carrier for comparison.

Some have implied that HB 1171 would somehow force consumers to pay high, unregulated rates for their homeowners insurance.  Our analysis suggests the opposite.  This bill does not force anyone to do anything; on the contrary, it gives consumers additional choices for their homeowners insurance, and if the companies charge too much, consumers would have the choice to reject them and shop elsewhere.  Therefore, it can be argued that even ‘unregulated rates’ are regulated—by the free market.

The current unhealthy concentration of hurricane risk inside the state through the overreliance on small, Florida-only carriers, or worse, Citizens’ Property Insurance Corporation and the Florida Hurricane Catastrophe Fund has the potential of placing Florida in the unenviable position of facing a fiscal calamity after a hurricane.  A healthy, robust insurance environment will allow Florida to be flooded with much-needed out of state capital after a hurricane allowing for a faster recovery.

HB 1171 puts the state on the right track to achieving this objective, while protecting and educating consumers, and expanding their choice.  I strongly urge you to sign this good bill.