Organizational & special sessions ahead
Fresh off the elections, the new Florida Legislature is back at the state Capitol tomorrow for its organizational meeting to swear-in new members and leaders. The one-day session is largely ceremonial. Republicans now have a super-majority in both chambers, with 28 of the 40 Senate seats and 85 of the 120 House seats.
Incoming House Speaker Paul Renner
The incoming Speaker of the House is Rep. Paul Renner (R-Palm Coast), a commercial law attorney and former Navy Commander. He’s been a lawmaker for the past seven years. The incoming Senate President is Sen. Kathleen Passidomo (R-Naples), a real estate attorney and long-time legislator. She served in the House of Representatives from 2010-2016 and was elected to the Senate in 2016 and subsequently reelected. Neither leader has announced any committee assignments, including those impacting insurance. Congratulations to both!
Incoming Senate President Kathleen Passidomo
The legislature is expected back on December 12, the likely date for the special session (1B) called by the Governor to address economic relief for Hurricane Ian victims and ongoing problems in our property insurance market. While no formal legislation has been publicly announced, Speaker-designate Renner told City & State Florida that he expects a “pretty robust special session on property insurance.”
Renner said a priority will be to “provide stability and capacity in the market, which is frankly at risk at this point. We don’t want that to happen where we have people who can only get Citizens policies. We’ve seen the dramatic rise in Citizens. So addressing the stability of the market and sufficient capacity is job one for the special session. But really 1B, if you will, is to make sure we begin the process of taking steps that will bring down the cost of insurance.” He warned that lower costs will “not happen overnight,” but that with the additional reforms “we’ll see those rates decline, and hopefully at some point actually see some reversal of the increases so people can get a break on their insurance premiums,” he told the publication.
Barry Gilway, President & CEO, Citizens Property Insurance Corporation
Depopulating the state-backed Citizens Property Insurance, with a policy count of 1.1 million and growing weekly, is an idea supported even by Citizens’ leadership itself. President & CEO Barry Gilway told the Citizens Board in September that “Citizens cannot be competing with the private market. We can’t be the cheapest company on the street,” noting that in some counties Citizens was half the price of the nearest private competitor. That happened as a result of the 2007 legislature capping Citizens annual rate increases at 10% as part of a “glide path” to actuarially sound rates. Board Vice Chairman Scott Thomas during the discussion that followed said “we eased eligibility requirements, we cut our rates, and we became a predatory competitor instead.” The Governor made clear his stated goal in the upcoming special session is to “introduce more competition and policies that will lower prices for consumers.” We applaud Barry Gilway for his thought leadership on balancing the public and private marketplace.
The private market is calling for meaningful legislation to reduce abusive claims practices, warning of more retrenchment in its absence. One company recently reported an intentional 19% reduction in homeowners policies, a trend among the industry. The five publicly-traded private writers in Florida reported an almost $4.6 billion decline in share price and market cap.
The Governor told the News Service of Florida that he’s working on a “robust” agenda with legislative leadership that could mean more special sessions prior to the 2023 regular session that begins on March 7, 2023. “We may even end up doing one or two in January, February potentially,” he said. As for now, the legislature will hold a series of six weekly meetings for committees to discuss bills during January and February leading up to March 7.
LMA Newsletter of 11-21-22
