Once again, the Florida Legislature is debating ways to move Florida residents off Citizens Property Insurance Corp.'s rolls. The state-backed insurer is the largest property insurance carrier in the state, and lawmakers continue to worry that the company's reserves will not survive a major catastrophe. If that happens, everyone loses, according to Citizens' critics.
Well, if Florida didn't have enough to boast about, we do now! The National Association of Insurance Commissioners recently released a comparison of insurance expenditures by state and by nation. Florida, the fourth most populous state, ranks third in the U.S. for insurance expenditures. We shell out more every year than developing nations do.
Industry numbers are coming in for fourth quarter 2012, and there is not much good news for property/casualty insurance customers. According to the Council of Insurance Agents and Brokers' Commercial P/C Market Index, commercial coverage premiums jumped 5 percent on average during the last three months of the year. The Southeast U.S., including Florida, followed the national trend.
It seems that hardly a week goes by without another insurance provider being found guilty of wasteful, fraudulent, and exploitative business practices. With the stakes so high and matters such as a person's house, car, or health on the line, any malicious or negligent activity on the part of an insurance company has the potential to irreparably damage a person's life.
Superstorm Sandy missed Florida, but as we have noted in past posts the storm wrought havoc further up the East Coast. As the insurance industry looks back at 2012, it has become clearer that Sandy was a key component of insurance companies' higher than normal catastrophic losses last year.