Sunshine State News
by Kenric Ward
May 21, 2011
Declaring “Republican Hurricane Season,” the Wall Street Journal on Saturday blasted Florida’s GOP lawmakers for failing to substantively reform the state’s casualty insurance system.
Extending its umbrage to Rick Scott, the bible of business said the governor “risked hyperbole” when his office claimed that new insurance legislation was “a significant step toward making Florida more competitive and attracting new companies into the state.”
The problem, as the Journal sees it, is that Florida lawmakers maintained the state-backed Citizens Insurance and the Hurricane Catastrophe Fund essentially as is. Naturally, this was a bipartisan cock-up, with Democrats and Republicans joined together.
“Private insurers continue to shrink their business in Florida because they can’t compete with [the] two taxpayer-backed behemoths,” the Journal observed. Three more private insurers halted underwriting in the state this week.
Chiding the governor for settling for what it characterized as a weak political compromise by the 2011 Legislature, WSJ recommended true market-based reforms:
“If Mr. Scott is serious about restoring competition to Florida’s hurricane insurance market, he’ll work to revive bills that would set Citizens’ rates nearer to private-market rates and roll back the Cat Fund.”
Acknowledging that true reform won’t be an easy sell, the Journal editors warned that the status-quo is unacceptable — exposing Florida taxpayers to untold billions of dollars in liability if and when The Big One strikes.
http://www.sunshinestatenews.com/blog/wsj-weak-insurance-reform-exposes-floridians-fiscal-disaster
