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PIA's Brevik Praises Florida Property Insurance Reforms Following PIA of Florida Forum

WASHINGTON, May 19, 2006 - Elements of a Florida property insurance reform bill signed into law May 16 by Governor Jeb Bush could...
May 19, 2006

Elements of Florida Bill Could Be Incorporated Into National Legislation

WASHINGTON, May 19, 2006  -  Elements of a Florida property insurance reform bill signed into law May 16 by Governor Jeb Bush could be included in national legislation, according to the National Association of Professional Insurance Agents.


PIA National Executive Vice
President & CEO Len Brevik
moderates a panel of Florida
insurance executives and state
officials discussing property
insurance issues on May 12, 2006
in Orlando. The forum was
conducted by PIA of Florida.

In remarks following a PIA of Florida panel comprised of insurance executives and state officials which he moderated, PIA National Executive Vice President & CEO Len Brevik said the Florida bill contains elements that could be considered in crafting national legislation.

"This is the most significant, comprehensive property insurance legislation that has been enacted since Hurricane Andrew," said Brevik. "It helps insurer solvency and loss mitigation while at the same time strengthening consumer protections. This is precisely the kind of innovation that will be needed as Congress crafts national legislation."

The Florida legislation includes: the implementation of a flex-rating system that will allow insurers to adjust rates five percent statewide and ten percent within a specific region; a provision to allow small insurers to buy more reinsurance from the Florida Hurricane Catastrophe fund, along with a $250 million surplus loan program with insurers eligible for up to $25 million if they raise private matching capital; 50 percent matching grants to homeowners for retrofits; free inspections to determine what loss prevention measures are needed to reduce vulnerability of hurricane damage; and an increase in the limit of a claim covered by the Florida Insurance Guarantee Association from $300,000 to $500,000.

The bill also eliminates homes valued at more than $1 million from the state homeowners insurer of last resort, Citizens Property Insurance Corp., after 2008. In limited circumstances, homes valued at more than $1 million could continue to be insured if the homeowner demonstrates that no admitted carrier would offer coverage and that at least three surplus lines carriers had rejected coverage. In addition, the bill bans public adjusters from participating in the repair of damaged property that they adjust.

In September 2005, the PIA National Board of Directors reaffirmed support for federal legislation. PIA National President Ray Peretti appointed a special task force to examine the various pending proposals and make recommendations to Congress. PIA Vice President/Treasurer Robert Page of Houma, Louisiana is chairman of the task force.

"PIA believes the time has come for Congress to adopt and fund a coordinated natural disaster catastrophe program on the national level, a public-private collaborative effort that includes prorated participation by states and local governments, together with the all sectors of the financial services industry," Brevik said. "Providing such a backstop for natural catastrophes will benefit both consumers who are victims of storms, and insurance carriers suddenly overwhelmed by an onslaught of extraordinary storm-related claims."

"The states are the laboratories for democracy and with this legislation, Florida is on the cutting edge," Brevik added. "Passage of this legislation in Florida, along with the recent approval of significant tort reforms including the repeal of joint and several liability as well as newly-enacted limitations on class action lawsuits, will combine to create a more robust and business-friendly climate in the Sunshine State."

Founded in 1931, and celebrating its 75th anniversary in 2006, PIA is a national trade association that represents member insurance agents and their employees who sell and service all kinds of insurance, but specialize in coverage of automobiles, homes and businesses. PIA members are Local Agents Serving Main Street America.

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