Reduce Home Insurance

It’s time for you to have relief from the enormous costs of living in Florida, and one of the daunting issues that Florida homeowners are currently grappling with is the escalating costs of home insurance policies. The urgency of the situation necessitates federal intervention to manage this crisis, and it’s time for our elected officials to get their heads out of the political sand and help relieve the financial weight it’s putting on homeowners. Enacting stronger consumer protection laws that prevent unfair pricing practices and ensure that consumers have avenues for recourse will allow Floridians and other states’ citizens to once again have access to fairer and more affordable insurance premium costs.

Coastal states like Florida, Texas, and Louisiana are witnessing exorbitant rate hikes that have resulted in Florida homeowners paying more than four times the national average for home insurance, a financial strain that is becoming increasingly unbearable. Many homeowners in our state and elsewhere in the nation are unable to afford home insurance or are being involuntarily dropped by insurance companies who do not want to take profit risk because of hurricanes, floods, tornadoes, wildfires, and other natural disasters.

The insurance industry is more multi-state today than ever before, which means that the consumer should be better protected by adding a level of oversight and enforcement at the federal level. To strengthen the federal oversight role of the insurance industry and more immediately help you, I propose amending the Wall Street Reform and Consumer Protection Act of 2010, better known as Dodd-Frank, to have direct supervisory or regulatory authority over the business of insurance in cases where two or more state insurance rates exceed two times the national price average.

To reduce our insurance premium costs, I favor:

• Strengthening Federal Oversight and Standards:  We promote fairer pricing by developing more evident federal standards for insurance pricing and practices to ensure uniformity and fairness across Florida and the states. I would also expand federal insurance programs like the National Flood Insurance Program (NFIP) to cover more risks, thus reducing reliance on private insurers who needlessly jack up premium prices and, therefore, corporate profits.

• Strengthening Consumer Rights and Protection: Enacting consumer protection laws that prevent unfair pricing practices and ensure that consumers have avenues for recourse are critical, as are subsidies and assistance programs or financial assistance to low-income homeowners to help them afford necessary insurance coverage will be essential.

• Encouraging Competition: To increase competition, barriers to entry should be removed so that new insurance companies can enter the market more easily. Enforcing antitrust laws to prevent monopolistic practices that can drive up costs will also help immensely.

• Risk Mitigation and Stronger Disaster Preparedness: We should incentivize all mitigation efforts by providing federal subsidies or tax incentives for homeowners to undertake disaster mitigation measures, such as fortifying homes against hurricanes or earthquakes. Investing in infrastructure improvement that reduces the risk of catastrophic damage, which can, in turn, lower insurance premiums is advised.

• Greater Federal Reinsurance Support: Creating or expanding federal reinsurance programs will help backstop private insurers against large-scale disasters, helping to stabilize the market and control premium costs to our homeowners.

• Promoting Deeper Transparency and Standardizing Disclosure Requirements: Insurance companies must disclose how premiums are calculated and what factors influence price increases.  Giving the public access to the data on insurance premiums and claims publicly available will help consumers make informed decisions.

• Stronger Collaboration with States: Success will come in this area where we endeavor to work with state insurance regulators to align state and federal efforts, thus ensuring comprehensive and cohesive regulation. We must also encourage the sharing of best practices among states to improve regulatory frameworks and consumer protections nationwide.

• Prohibiting Insurance Policies Where Compliance and Cooperation is Absent: Finally, I would propose prohibiting insurance companies from writing insurance policies of any type in any state where two or more states have insurance costs exceeding two times the national average. This would incentivize insurance companies to spread the risk among all of their markets so that fairness, despite whatever disaster might occur, is assured.