You Dirty Rat

Florida’s Governor Charlie Crist tried out the newest weapon in his arsenal for lowering the property insurance rates in Florida - calling the insurance industry names! In January of this year, Crist and the Florida Legislature thought they had "solved" the property insurance crisis by artificially lowering the cost of reinsurance purchased via the Florida Cat Fund and cut intended Citizens Property rate increases. Crist and Insurance Commissioner Kevin McCarty sold this reduction to the citizens of Florida as a 24% cut in premiums, yet when rate adjustment filings came in from the industry, 36 of 47 of them were seeking an average of 37.3 percent increase. "Greedy!" Crist called them. While Crist called names and complained about his magic plan being thwarted by a "less than honorable" insurance industry, Bob Hartwig, President of the III reminded the public that "In reality, it is the governor and politicians who over-promised and under-delivered." Crist's magic plan also resulted in a small decrease in Citizens’ rates that many believe represents unfunded pandering to the voters, since any significant hurricane will undoubtedly require a taxpayer bail-out of both Citizens and the Cat Fund — a bailout that unsuspecting Floridians will only discover after the fact. We’ll see who gets called names then.

Penn Snuggles With Chavez

The term "useful idiot" was widely ascribed to the Soviet Union’s Vladimir Lenin to describe naive Western journalists and communist sympathizers, who, it was clear to Lenin, acted and spoke against their own self-interest and that of their country out of a foolish, idealistic notion of communism’s actual agenda. One wonders if the same idea has passed the consciousness of Venezuela’s dictator Hugo Chavez as he hosts such self-loathing American buffoons as Harry Belafonte, Danny Glover, Cindy Sheehan and, most recently, international affairs expert, Sean Penn. Penn may be an accomplished actor and CITGO may be a passable gasoline — but I’m not buying either.

Florida Who's-Fault?

The Florida No-Fault sunset is getting closer by the day and the September special session is the last chance to save it. Many on the carrier side, State Farm in particular, want PIP to disappear, claiming a "savings" to insureds. (Yeah, and if you buy no insurance at all, you can save even more...) As far as I’m aware, unlike property insurance, there is no political or regulatory reason why PIP cannot be properly priced, so I am confused as to the reason behind the carriers’ desire to eliminate the coverage — even if PIP may inspire some fraud. Hospitals, first responders and emergency care providers are in a panic since PIP benefits are the sure source for the lion’s share of their income. And, of course, personal lines insurance agents (some even have "No-Fault" in their names) and the insurers they market have a business model entirely based on mandatory auto insurance. While some state experts claim the $10,000 PD Liability requirement will continue after the No-Fault sunset, there will apparently be no enforcement mechanism in place to make certain drivers are actually buying the coverage.