Crist aims to tame insurance lobbyists


Published: Sunday, January 14, 2007 at 6:01 a.m.
Last Modified: Sunday, January 14, 2007 at 1:12 a.m.
TALLAHASSEE - For years, insurance lobbyists have been able to influence the laws of the state by helping write bills for lawmakers struggling to deal with the complicated world of rate-setting and risk-sharing.
This year, however, the insurance industry has been largely shut out of the battle to lower rates despite giving at least $5 million to the Republican Party of Florida and Gov. Charlie Crist during the 2006 campaign. Crist prodded lawmakers into supporting a general plan for this week's special session that would make the state-run Citizens Property Insurance a more viable competitor in the state's insurance market. Citizens may be freed to sell other, profitable policies such as fire and theft while eliminating the law that forces Citizens to charge more than private insurers.
And insurance companies may have to return excess profits, eliminate subsidiaries in the state to factor in national profits when setting rates, and offer property insurance if they only offer other policies currently.
That's a reversal from lawmakers' previous efforts to raise rates to offset insurers' previous losses and entice more competition in the state.
One of Tallahassee's most powerful lobbyists, Brian Ballard, said the insurance industry is a ''very weird clique'' that has been largely excluded from the debate this month.
He said insurance lobbyists' message to lawmakers has been, ''no one else could understand what's happening so you simpletons stay out of the policy making.''
''The truth of the matter,'' said Ballard, a close friend of Crist's, ''is you have a governor now who says, 'You may be the smartest guys in the world but you have mangled this system in this state, so we're going to exclude you from the process and bring in folks who don't have an ax to grind.''
Crist convinced die-hard free market Republicans to ignore the insurance industry and endorse a big expansion of Citizens without the benefit of his own legislative lobbyist who wasn't hired until last week.
Instead, Crist unleashed a rhetorical barrage, saying lawmakers needed to hold ''the industry's feet to the fire,'' accusing insurers of ''profiteering on the backs of Floridians,'' and warning that ''big insurance has a new day coming.''
Rep. Dan Gelber, D-Miami Beach, said the insurance industry has been ''pretty marginalized.''
''What's happening is amazing, just the direct turnaround of the Republican Legislature in the last two months. The insurance lobbyists have no champion in management right now,'' said Gelber. ''That's due in great part to Gov. Crist. He has given them no cover and has been unapologetically bashing them and, I think, rightfully so.''
Sam Miller, the vice president of the Florida Insurance Council, said the power of the insurance lobby is overstated.
''I wish we were as powerful as I keep reading in papers that we are,'' Miller said. Beyond Crist's hard stance, the dire fiscal woes facing homeowners made it difficult to support any option that included rate hikes to help insurance companies recover from billions in losses in 2004 and 2005.
''If lawmakers, if Charlie, allowed the industry to dictate this solution, they would all suffer some fairly serious ramifications,'' said Ron Book, an A-list lobbyist who called the upcoming special session the most critical ''in public magnitude'' that he's seen in his 35 years in Tallahassee.
When the House abandoned its own proposals in exchange for much of Crist's platform, none of the House's insurance chairmen who had close ties to the industry were present at the announcement.
Rep. Dennis Baxley, R-Ocala, one of the Legislature's staunchest conservatives, acknowledged a need for ''crisis management,'' but said the House's plan to expand the state's involvement in insurance was a shock.
''A lot of us were stunned,'' he said. ''I have some serious questions.'' But Baxley and others say they understand the political damage that would come with helping insurers while rates have exploded. ''I think the worst thing that could have happened is for us to come out with a real tough industry protection bill and get postured as being anti-consumer,'' said Baxley.
Republicans and Crist were clearly the choice of insurance industry donors for the 2006 campaign who gave almost 10 times as much to the GOP as they did to Democrats.
Contributors who listed their occupation as insurance gave $4.4 million to the Republican Party of Florida compared to $461,000 to the Florida Democratic Party.
Insurance contributors gave about $400,000 to Crist's campaign, where they were limited by a $500 maximum contribution, compared to $41,000 for Davis.
These contributions don't include money given by affiliated interest groups or individuals listing other occupations.
Ballard, among the biggest fund-raisers for Crist's campaign, said Crist's first weeks validate the new governor's assertion that contributions won't affect his decisions.
''If you believe that because you were supportive of Charlie Crist in the campaign that whatever you want is a lock, that's obviously not the case,'' said Ballard, who called the abrupt change under Crist ''refreshing.'' ''I think people are going to get this,'' Ballard said, ''eventually.'' For now, insurance lobbyists are a dour group. ''Look at their body language and their faces,'' said Book of a committee hearing last week. ''I think they're very concerned about what they're getting. They're sent there as a rule to fix the bottom line of the company, not the bottom line of the consumer.''

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