As politicians declare insurance victory, homeowners fret

Published January 24, 2007

TALLAHASSEE - Last week Cindy DeRocher joined hundreds of Floridians who flooded the Capitol during the special legislative session on property insurance. She waved her signs and shouted for lower rates.

"That many people showing up was a loud statement about how bad the crisis was," she said. "I was feeling pretty optimistic."

The feeling has faded.

A day after the Legislature passed the bill, DeRocher said Tuesday that while there are positive aspects of the deal, the savings fall short of expectations and much remains to be done.

The cautious reaction, echoed by numerous consumer advocates and ordinary Floridians interviewed Tuesday, contrasts with the euphoric backslapping among lawmakers after finalizing the bill Monday night.

The celebratory mood will continue later this week as Gov. Charlie Crist plans to fly to various locations in the state for bill-signing ceremonies, though he, too, has acknowledged that more work is necessary.

"When we first looked at the bill, it looked very promising," said DeRocher, a 45-year-old landscaper from Key West who heads a group of Monroe County residents incensed with premiums that have doubled or tripled. "But they kept chopping away at it. Two days ago we were hearing 30 percent rate reduction; now we're hearing 15 percent."

Estimates of average savings are 22 percent of the total premium for customers of most private insurers; 7 percent for State Farm Florida customers; and up to 9 percent for Citizens Property Insurance Corp. customers. Further reductions could be achieved by customers increasing their deductible or strengthening homes against storm damage.

"The rate decreases are less than satisfying," said Ginny Stevans, president of a Port Richey group, Having Affordable Coverage, that formed as premiums began to skyrocket after the hurricanes of 2004 and 2005. Even parts of the bill Stevans praised carried a caveat. For example, ending the practice of allowing insurers to increase rates and then seek approval is positive, she said, but that requirement expires after two years.

"We have a lot of work ahead and plan on going full force during the regular session," Stevans said.

Days after the November election, Susan Weisner-Hall, 51, of St. Petersburg sent Crist an e-mail steeped in dread. Her Citizens bill, she said, was threatening to strip her of her home.

"I have to tell my granddaughter that we cannot have a turkey for Thanksgiving because Meme has to use all the money she made this pay period on her homeowners insurance," she wrote. "This is sad, this is very sad."

Reached by telephone Tuesday, Weisner-Hall said she had read about the bill in the newspaper and was not happy. "I read where (the savings) could be 9 percent? What's that? I'm going to save, what, a couple hundred dollars?"

At Sen. Mike Fasano's office in New Port Richey on Tuesday, call volume was surprisingly light. But the constituents who did pick up the phone to comment on the Legislature's insurance reform efforts were mostly complimentary, said Christine Hunter, Fasano's legislative assistant.

Many Floridians may have been holding off on congratulatory calls until they figured out exactly how they would be affected by the package passed Monday in an effort to lower homeowners' premiums.

"It's the bottom line really that everybody's waiting to see," said Patricia Murphy, a State Farm customer in Port Richey whose premiums doubled last year. "You never know what's going to happen till it gets right down to the crunch figures."

Homeowners will see lower bills on policies or renewals written after June 1. If your renewal is before that, the savings will not come until 2008. Citizens customers should see more immediate relief because the company's rates are frozen at the 2006 level under the bill.

"There will be some savings, especially compared to how much rates would have gone up if the bills were not passed," said Bill Newton, executive director of Florida Consumer Action Network, who characterized the bill as a good start. "We would have liked to see more, but this certainly will help lots of people."

That was little comfort to some Tampa Bay area residents. Mark Johnson of Gulfport saw his homeowners' premium triple to $3,300 last year. He put a piece of commercial property up for sale after the insurance jumped to $13,000 from $2,000 a year ago. So far it has not attracted a buyer.

"We need immediate help out here; real estate sales are dead," said Johnson, 61. "They're not saying how much rates will go down, and next year I don't think I can handle the cost."