Orlando Sentinel
by Aaron Deslatte
April 27, 2011
TALLAHASSEE – Two opposing worldviews of Florida’s insurance market are clashing as the Senate debates a broad insurance de-regulatory bill that the industry has been pushing. In the new pro-industry, post-Charlie Crist chamber, senators beat back an amendment Wednesday to require insurers to continue to provide sinkhole coverage.
The bill, SB 408, among many other deregulatory changes, repeals the requirement that private insurers include sinkhole coverage in their mandatory offerings. Insurers have argued that sinkhole claims have exploded throughout the state because of fraudulent claims.
But Sen. Mike Fasano, R-New Port Richey, has a district at the epicenter of sinkhole claims and has argued that sinkhole damage has gotten so severe that mortgage lenders are now mandating coverage and forcing would-be homebuyers to purchase more-costly out-of-state coverage.
“You will have people who want to buy a home in this state who will not be able to get sinkhole coverage and will not be able to get a mortgage,” Fasano said.
“Talk about an economic disaster. We are already having problems selling homes in this state.”
Fasano offered an amendment to keep the sinkhole coverage requirement in law.
But Senate Budget Chairman J.D. Alexander, a former insurance chairman from Lake Wales, has quarreled with Fasano for years over former Gov. Crist’s push to lower rates. He argued forcefully on the floor that Fasano’s amendment would allow people with “a crack on the sidewalk” to continue milking millions of dollars in fraudulent claims and driving up rates.
“What we’re talking about isn’t advocating for the people. It’s advocating for the people who are mining tens of millions of dollars in a cottage industry,” Alexander said.
“At some point in time we have to start saying we need some sanity to this issue.”
And of course, no chance to take at shot at Crist has gone to waste.
So the bill sponsor, Sen. Garrett Richter, R-Naples, said the former governor “didn’t care” whether the insurance market in Florida was sound has he drove lawmakers and the Office of Insurance Regulation to freeze rates during his term.
As a result, Florida’s private carriers and the state-run Citizens Property Insurance are woefully under-funded to deal with a catastrophic hurricane.
“If it comes this year, we’re too late,” Richter said.
The amendment went down, 12-20.
http://blogs.orlandosentinel.com/news_politics/2011/04/senate-sinks-into-sinkhole-squabble.html
