In efforts to drop policies in the state-run Citizens Property Insurance the Florida Senate is getting ready to approve a bill that would give homeowners an unregulated, low-cost, insurance alternative. This would allow Citizens customers to select a “surplus lines carrier” when their policy is up for renewal. Those opposed to this are saying that this bill is misleading homeowners into thinking they are getting the same insurance for less cost when in actuality it is not. Others feel it is a free-market alternative and homeowners should be able to make their own choice and decide what their risk is themselves.
Under the bill, SB 1672, homeowners will have the option to choose from unregulated insurance sold by surplus lines in addition to Citizens when they are up for renewal. Rates will be at least 15 percent less than citizens. This must come with a disclaimer that surplus lines insurance is not regulated.
In 2013 state legislators made it a requirement that homeowners cannot renew a Citizens insurance policy if a licensed insurance company has rates that are comparable to those offered by Citizens. Also, Citizens can have a 10 percent yearly rate increase.
March 10, the state-run clearinghouse added 10 insurance companies that could be chosen instead of Citizens. If a homeowner has not been given the option to choose a different policy from any of those 10 companies this bill will allow them to choose from a surplus lines carrier.