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County wise to follow Monroe vs. Citizens

A Times Editorial
Published September 28, 2006


Pasco County is looking for its own Monroe Doctrine.

Forget foreign imperialism. Faulty insurance premiums are the concern. Pasco seeks to emulate the success of Monroe County in disputing the validity of homeowner insurance rates charged by Citizens Property Insurance Corp., the state-created insurer of last resort.

Tuesday, Pasco commissioners retained Jacksonville attorney Tim Volpe, who along with an actuary from Pennsylvania helped Monroe County successfully challenge Citizens premium prices. The company had wanted a nearly 26 percent rate increase in Monroe, but regulators ordered a 32 percent reduction, instead.

Though a permanent solution to skyrocketing insurance premiums likely lies in Tallahassee, commissioners are smart to investigate pitching their own case to combat a proposed rate increase from Citizens, which underwrites 45,000 policies in Pasco.

In Monroe, Volpe told commissioners he was able to argue Citizens had overstated the risk of wind damage. Pasco's focus, however, could be pointed downward. Citizens has proposed a rate increase for noncoastal Pasco that would take coverage for a $100,000 home from $1,842 to $2,600. More than 60 percent of the cost is attributable to sinkhole coverage. West Pasco is ground zero for increased sinkhole claims, and Citizens has said Pasco cases account for two-thirds of the $95-million paid for sinkhole damage statewide.

Aggressive client recruiting by legal firms specializing in sinkhole claims is cited as a common reason for the growing number of claims. But, at a town hall meeting in March, customers pointed out other factors including fraud, Citizens' failure to investigate claims properly and speculators willing to buy sink-hole damaged homes. Tuesday, Volpe said he had found nothing to indicate geological circumstances are contributing to the high number of claims.

Recent legislation from state Rep. John Legg and Sen. Mike Fasano mandating mediation in sinkhole cases and capping attorney fees in some instances will reduce premiums from 4 percent to 14 percent, according to projections.

The modest savings are welcome, but of little significance to homeowners facing insurance bills totaling several thousand dollars and the demise of affording housing opportunities. (Last week, Fasano announced a proposal to establish a state fund to help low- and moderate-income homeowners pay their insurance premiums.)

The commission is right to proceed on its own, and Commissioner Pat Mulieri, in particular, should be commended for discovering Monroe's strategy and asking Pasco to do likewise.

Success isn't guaranteed, but inaction isn't an attractive alternative.

[Last modified September 28, 2006, 07:04:08]


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