Lawmakers seek common ground on insurance


Published: Saturday, January 20, 2007 at 6:01 a.m.
Last Modified: Friday, January 19, 2007 at 11:22 p.m.

TALLAHASSEE — With lawmakers muddling through the complex and shifting projections of just how much property insurance rates can be cut, Gov. Charlie Crist on Friday attacked one particular company in a sometimes angry reminder to lawmakers to cut rates for people.

Lawmakers struggled all day long to reach agreement on dozens of differences between House and Senate proposals to cut rates in an effort to pass a law by the scheduled conclusion of a weeklong special session on Monday.

But Crist kept it simple. At noon his office desk was clean except for a stack of petitions — titled "The Voice of the Floridian Voters" — signed by more than 3,000 Space Coast residents demanding relief from insurance rates.

Crist called a few residents who had written him about their insurance woes and talked to one — 78-year-old Stan Whitney of Port Charlotte, who has dropped his home insurance due to high rates.

"Remember Stan," he told lawmakers. "We've got to make sure we keep Stan in mind."

Crist singled out State Farm, the state's largest private insurer with more than 1 million policyholders in the state. The company has balked at a plan to buy insurance from the state to protect itself from a catastrophic hurricane season, saying it can buy the reinsurance from its own parent company at a cheaper rate.

Doing that would exclude State Farm from a plan intended to force insurers to pass on reinsurance savings to its customers.

In a separate interview, Crist borrowed State Farm's advertising slogan to urge the company to lower its rates.

"They could be a good neighbor. Part of being a good neighbor is doing the right thing," Crist said.

Asked about comments that state-run insurance was the "worst" insurance company in the state in terms of customer service and timely payment of claims, Crist angrily mentioned the plight of an elderly woman in Pensacola whose State Farm insurance rates rose from $1,000 to $5,000.

"I think she thinks that State Farm is the worst company," Crist said before abruptly ending a news conference.

The comment angered State Farm lobbyists who have been put in a linchpin position in deciding what plan lawmakers can adopt.

State Farm lobbyist Mark Delegal declined to comment when told of Crist's comment, saying "If I do, I'm about to blow a top."

Later, State Farm spokesman Justin Glover said the company was simply charging the rates approved by the state to remain fiscally viable.

Privately, some lawmakers and lobbyists grumbled that Crist was unfairly demonizing insurers in a series of moves that resembled campaign stump speeches.

But other lawmakers said Crist's style of general promises to lower rates were allowing lawmakers to work more freely than they could under his wonkish predecessor, Jeb Bush.

"He's made it very clear what he wants to accomplish and our goal is to try to accomplish it," said Rep. Jack Seiler, D-Wilton Manors. "I've got a lot of respect for this governor."

Seiler said he understood Crist's frustration, since lawmakers were feeling the same thing as they confronted the complexities of the insurance issues.

"This is like a Rubik's cube right now. Trying to come up with these savings, we put a number in here and it pops up over there," Seiler said.

But Seiler said he was confident lawmakers would achieve the governor's goals before the session ends Monday. "We're going to get there."

Crist has ceaselessly kept to his campaign message of being "the people's governor," and has taken to describing state-run Citizens Property Insurance as "the people's company" in arguing that it be allowed to sell more profitable policies in areas like fire and theft to offset its debt-ridden bottom line that is subsidized by taxpayers and all property insurance policyholders.

Senators agree with Crist's plan to expand Citizens. But House members have balked, saying Friday that the company should have to show lawmakers a solid business plan for the expansion before it is approved.

Crist mocked the idea of needing a business plan for the unprecedented involvement of a state in the convoluted insurance sector.

"I've got one. And it is to have the people work hard," he said. "It's not complicated. It is not complex. It is straightforward and simple and it's an American idea."

In an effort to help Citizens' customers, some lawmakers Friday floated a new proposal they say would save Citizens customers about 35 percent from current rates.

The savings would be achieved by suspending the requirement that Citizens buy backup insurance from the Florida Catastrophic Fund, an emergency pool of money set up for hurricane recovery. Citizens pays about $400 million to $500 million for the extra coverage.

Removing Citizens from the pool would leave a hole that would have to be subsidized by the state somehow, but lawmakers disagree about where to find the money and even if the cut is the right thing to do. It's possible the state could use part of its budget reserves to make a loan to the catastrophic fund temporarily.

"We're looking at it very seriously," said Sen. Steve Geller, D-Hallandale Beach.

But the 35 percent savings would also only be possible if lawmakers agree to expand the Citizens program to sell policies for theft, fire and other types of insurance.

Sen. Jeff Atwater, R-North Palm Beach, who is pushing for the Citizens cut in the Senate, said that expansion is the only way to guarantee Citizens customers will see a real reduction in their bills this year.

"These are the real people of Florida who are suffering," Atwater said. "That's the reason we came to the special session."

House leaders remain reluctant to let Citizens expand into other lines of coverage because some estimates show the expansion would cut rates by only 10 percent. "That's not significant," Rep. Seiler said.

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