Florida Today
By Dave Berman
April 25, 2012
BAREFOOT BAY — Residents of Florida’s largest manufactured home community are upset that they are paying more and getting less for hurricane insurance coverage on their residences.
On Tuesday, they told two officials from their insurer, the state-created Citizens Property Insurance Corp., of their concerns in no uncertain terms. They even indicated they will look into forming their own insurance company, rather than paying Citizens’ continually rising rates.
About 330 residents of Barefoot Bay and nearby communities packed a community center meeting room to express their views and hear from Citizens, an official of the Florida Office of Insurance Regulation and Rep. Tom Goodson, who represents them in the Florida House. The meeting was a bit heated at times, and at least some in the audience left the meeting unsatisfied.
Although the issues they focused on dealt chiefly with coverage for manufactured or mobile homes, the issue of hurricane coverage rates and availability is prevalent throughout the Southeast .
Citizens was created to provide hurricane coverage to property owners who could not get insurance from private carriers. It insures about 4,500 of the 4,900 properties in the Barefoot Bay community at the southern end of Brevard County, according to Christine Ashburn, the company’s director of legislative and external affairs. Many of the other homeowners in Barefoot Bay go without hurricane insurance.
Citizens has grown into the largest property insurer in the state, with about 1.5 million policies.
Monte Stevens, director of governmental affairs for the Florida Office of Insurance Regulation, said insurance availability is a major issue in hurricane-prone areas. Homeowners, both of traditional homes and mobile homes, are “either having rates go through the roof” or having trouble finding an insurer, Stevens said, something state officials are trying to address by attempting to get more companies to enter the market.
But Ashburn said it wouldn’t be a good idea for the state to force Florida’s auto insurers to also offer homeowners’ insurance as some have suggested. She said that could start an auto-insurance crisis, with soaring rates, as insurers stop writing auto policies in Florida, rather than start writing homeowners’ policies.
One of the immediate concerns at Barefoot Bay is the decision by Citizens to discontinue offering insurance coverage for carports and pool and porch screens, effective when policies are renewed this year. Citizens said many private insurers are doing the same .
At the same time, Barefoot Bay homeowners are seeing their Citizens premiums rise by an average of 10 percent this year.
Stevens said that’s because computer models and simulations indicate that the area that includes Barefoot Bay has been undercharged in the past, and the rate increase helps the premiums catch up . That was a view that drew hisses and boos from some in the crowd.
“That’s your answer to your question,” Stevens said. “It’s not going to be a popular one.”
Residents also didn’t like the fact that a lack of hurricanes in the past doesn’t translate into lower rates in the future, under the current rate-setting system.
And they questioned why they aren’t able to get discounts from Citizens on their premiums for hurricane-hardening measures they take, in contrast with the discounts offered to owners of traditional site-built homes.
Ashburn said there have been no studies to prove hardening measures reduce damage to manufactured homes in a hurricane, so Citizens cannot offer such discounts.
When some residents started to call out comments while she was answering the question, Ashburn said: “You want me to answer, or are you going to answer for me?”
At one point in the meeting, Barefoot Bay Homeowners Association President Bob Kahl asked how many of those in the audience wanted to explore forming a new insurance company as an alternative to Citizens. Most raised their hands, so Kahl and his executive board will research the options, with the help of officials at a local insurance agency.
Kahl said Barefoot Bay residents typically pay Citizens $1,500 to $2,600 a year to insure their manufactured homes.
Brevard County Commissioner Trudie Infantini, whose district includes Barefoot Bay, advised those in the audience that it would be “a long haul” and “a monumental amount of work” to form an insurance company. But she said she supports their efforts.
After the meeting, Stevens said Barefoot Bay forming its own insurer is perfectly legal, although it will be difficult because of the high coverage risk involved. Not only is it a manufactured home community, but the relatively compact geographic area means that a large percentage of those insured would have claims if a hurricane passed through the area.
In the meantime, Ashburn and Steve Bitar, Citizens’ senior director of consumer and agent services, advised Barefoot Bay residents to contact their local insurance agent to discuss whether to reduce their dollar level of coverage to reflect the fact that their screens and carports no longer are covered. Ashburn said some companies are or may soon offer supplemental coverage for screens and carports.
Goodson, R-Rockledge, told the residents that he doubts they will see significantly cheaper insurance premiums in their lifetimes, but suggested letting their state and congressional representatives know their concerns about property insurance.
“It doesn’t get us any closer to resolving anything,” said Barbara Jedrey, 68, a 23-year resident of Barefoot Bay. She said she is worried that the lack of insurance coverage for carports will create “a lot of uproar” within the community because either carports or garages are required under the community’s deed restrictions.
Terence Maguire, 73, a four-year resident of Barefoot Bay, said he was happy about the turnout at the meeting. But he didn’t feel satisfied by the lack of specifics about the financial data related to Citizens’ revenue and profits derived from Barefoot Bay.
http://www.tcpalm.com/news/2012/apr/25/angry-barefoot-bay-homeowners-take-aim-citizens-in/
