Print

Email story

Comment

Email editor

Sinkhole option gains support

Two legislators' proposal to trade the coverage for lower insurance rates could become law.

By DAVID DeCAMP
Published January 17, 2007

ADVERTISEMENT [Times photo: Scott Keeler] Members of Florida's House of Representatives stand in prayer Tuesday as both the House and the Senate begin a special session dealing with property insurance rates in the state. In the foreground is freshman Rep. Peter Nehr, R-Tarpon Springs.

TALLAHASSEE - A proposal to make sinkhole coverage optional in return for a big cut in rates for homeowners insurance has been added to a proposed Florida Senate bill, making two lawmakers optimistic it will become law.

"It's a done deal," state Sen. Mike Fasano, R-New Port Richey, said Tuesday.

The proposal would limit mandatory coverage to catastrophic collapses that leave homes uninhabitable. More comprehensive coverage, now standard with most policies, would be available as an option with a deductible.

Currently, insurers blame sinkhole claims for driving up rates in North Pinellas as well as Pasco and Hernando counties. Hundreds of claims come from residents of these areas, but few, if any, involve homes actually collapsing.

Fasano, whose district includes North Pinellas, is pushing the plan with state Rep. John Legg, R-Port Richey.

A draft house bill contains the Fasano-Legg proposal, but the original Senate version had different requirements. That caused Pasco and Hernando officials to worry last week that rate-increasing sinkhole claims would not be curbed enough.

With leaders in both houses now backing the change, its chances of being passed during this week's special session seem strong .

Pasco officials met with Lt. Gov. Jeff Kottkamp on Tuesday to seek support for the sinkhole option, among other items.

"I know your problems are unique when it comes to sinkholes," Kottkamp said.

Dropping sinkhole coverage for all but catastrophic claims could cut rates up to 58 percent in areas of western Pasco, according to a proposal by state-run Citizens Property Insurance Corp., Pasco's largest insurer. Pasco had two-thirds of Citizens' 600-plus sinkhole claims last year.

Officials have said that North Pinellas also would see some decrease in rates.

However, some local officials and activists worry about a provision in the House bill but not the Senate's that says a house must collapse within seven days of a sinkhole opening to be covered under standard policies.

Ginny Stevans, president of Pasco-based Having Affordable Coverage, said the law should allow collapse coverage "if you have an uninhabitable house - period." But the group does agree with allowing customers to have more insurance options, she said.

At Stevans' urging, Fasano said he persuaded the Senate's banking and insurance committee chairman, Sen. Bill Posey, R-Rockledge, to change the bill to include the requirements for collapse coverage and optional sinkhole coverage.

The seven-day provision in the House bill is "a sticking point but it's not something that's going to kill the bill," said Legg, who said the seven-day limit made some lawmakers more comfortable about the standard.

David DeCamp can be reached at (727) 869-6232 or ddecamp@sptimes.com.

[Last modified January 16, 2007, 23:13:37]