Senate bill freezes rates for Citizens
By JENNIFER LIBERTO
Published May 3, 2007
TALLAHASSEE - The Senate unanimously passed a bill on Wednesday to strengthen Citizens Property Insurance Corp. It now goes to the House.
The bill would prevent the state-run insurer from hiking its rates until 2009 to give time for changes made during a recent special session to work their way through to rates. Citizens has said it thought it would need to hike rates in 2008.
The other big change is in who can get into Citizens. Currently, if a private insurer is charging 25 percent more than what Citizens charges, a policyholder can switch to Citizens. The bill would drop the threshold so that policyholders can go to Citizens if their private insurers charge 15 percent more than Citizens' rates.
The Senate bill combines the Citizens' provisions with parts of the House's "glitch" bill that fixes technical issues left over from the special session.
The bill also aims to prevent new Florida-only subsidiaries, called "pups, " but that language is so loosely written, lawmakers acknowledged there are ways around it. It also requires pups to report the profits of their parent companies.
Chief Financial Officer Alex Sink has said that she has reservations about the bill and prefers the House's bill, which leaves Citizens alone.