Florida Cat Fund reform passes second state House committee
The bill, which already passed the House Insurance & Banking Subcommittee with overwhelming support, would reduce the Cat Fund’s obligations from $17 billion to $14 billion over a three-year period, beginning in 2014. Scaling back the fund’s exposure is an attempt to deal with projections that the state-run reinsurer wouldn’t be able to raise enough money following a major storm to pay all of its claims to Florida insurance companies, and by extension, their policyholders.
“Right-sizing the Cat Fund so that it can actually make good on the coverage it sells not only helps to avert an unprecedented economic crisis following a bad hurricane season, but will also send a signal to property insurers looking to bring their capital into Florida that we are open for business,” said R Street Florida Director Christian R. Cámara.
While the House bill continues to move forward, its Senate companion –- S.B. 1262, sponsored by Sen. Alan Hays, R-Umatilla -– has been postponed indefinitely in the wake of a Senate Banking and Insurance Committee amendment to gut the measure.
“The Florida Senate would do well to seize upon this movement in the House, as well as Senate President Gaetz’s past statements in support of this important issue, by advancing Sen. Hays’ Cat Fund reform package,” Cámara added.