[janmcn]

Originally Posted by GatorFan

Crist apparently discounted the advice he got from Insurance Commissioner Kevin McCarty, typically an ally of his, who had urged him to sign SB2044. The bill will make sure that “all potential rate increases are reviewed and approved or rejected by OIR [Office of Insurance Regulation] prior to one penny being paid by consumers,” McCarty had written to the governor.

In vetoing the bill, however, Crist actually allows insurers to go ahead and implement new rates before getting state approval under a use-and-file system. The bill would have required approval before use.

Crist also said he opposed the bill’s provision reining in premium discounts for homeowners who strengthen their homes against hurricanes. A state audit had found this mitigation program riddled with fraud and overly-generous discounts. But Crist said he was troubled that honest policyholders who took responsible steps to fortify their homes would be penalized under the tighter rules.

The bill, sponsored by Sen. Garrett Richter, R-Naples, also would have addressed solvency concerns by imposing a higher capital requirement of $15 million for a new home insurer.

It also would have more closely regulated the transactions between carriers and their affiliated companies, a reform Crist said he supported at a Cabinet meeting earlier this year.

Crist released his veto message just a few hours before the midnight deadline after which the bill would have become law without his signature.

The insurance industry had backed the bill as one way to get at some the forces driving up costs, including rising sinkhole claims and millions of dollars in claims from Hurricane Wilma that are being re-opened by claims adjusters five years after the storm. The bill would have more closely regulated public adjusters and their fees. It also would have allowed insurers to retain a portion of replacement cost claims payments until there is proof repairs are being made.

What date did all this transpire?

[GatorFan]

June 2010

[paulascorpio]

Right now in Royal Palm Beach where I live, I am about 20 miles inland, west from the coast....my insurance on my home (300k) is $2600 per year and another $300 for flood insurance. I'm sure my rate is a LOT higher than yours.

[Virtual Geezer]

Just wait until the insurance companies factor in the cost of Sandy into their calculations and people across the country will all be paying a lot more for insurance no matter where they live.

VG

[gomoho]

I have always wondered why folks on the coast are required to have "hurricane" (wind) insurance, but those in tornado alley aren't.

[OpusX1]

No one is required to have insurance. Lenders require insurance to protect the asset that they loaned money on. Many people that owe nothing on their property do not have any insurance, foolish imo but true.
Tornado's are much less destructive over a wide area than are hurricanes. It is all about the numbers. When the tornado hit here a small percentage of properties were damaged as compared to what would have happened if a large hurricane would have hit.

[NJblue]

I just went through this (rate increase) and this is what I found in my research in talking with people at AAA as well as The Villages Insurance:

Every policy in Florida is required to have "catestrophic" sink hole coverage. This is included in the basic price of the policy and typically will have the same deductible as you would for any other sort of loss (except hurricane which will have a higher deductible). This covers you in the case a sink hole suddenly opens up and makes your house unliveable (as defined by the county, I believe.) There are certain conditions that must be met for this to apply (e.g., house unliveable, sudden versus slowly over time, etc.)

In addition, you can buy an additional rider for sink hole coverage which covers you in the cases not covered by the above conditions. This is the component whose price is very high and which, going forward, has the extremely high deductible. This high deductible was actually madated by law. The reason for it (as explained to me) is that many homeowners were taking advantage of sinkhole coverage to get minor cracks, etc. repaired in their houses. They would work the system like this: They would make a claim on their sinkhole coverage that a sinkhole has caused minor damage to their homes. The insurance company would then have to hire geophysical engineers to evaluate whether there was a sinkhole. These evaluations were extremely expensive ($12-15K). Because of this, the insurance companies found it cheaper to just pay the claims rather than pay for the evaluations. So, in the end, the homeowners were able to get the insurance companies to pay for minor cracks and normal settling damage.

By raising the deductible to $20,000 or whatever it works out to on an individual property, this scam is avoided. However, since catestrophic coverage for sinkhole is already covered (with a very nominal deductible), it makes me question the additional value of the sinkhole rider for non-catestrophic damage since there's a good chance that such damage will be less than the deductible, anyway.

[applesoffh]

Originally Posted by buzzy

Which carrier, please?

Will gegt back to you through PM. Hubby is re-reading everything!

[Barefoot]

Originally Posted by NJblue

I just went through this (rate increase) and this is what I found in my research in talking with people at AAA as well as The Villages Insurance:

Every policy in Florida is required to have "catestrophic" sink hole coverage. This is included in the basic price of the policy and typically will have the same deductible as you would for any other sort of loss (except hurricane which will have a higher deductible). This covers you in the case a sink hole suddenly opens up and makes your house unliveable (as defined by the county, I believe.) There are certain conditions that must be met for this to apply (e.g., house unliveable, sudden versus slowly over time, etc.)

In addition, you can buy an additional rider for sink hole coverage which covers you in the cases not covered by the above conditions. This is the component whose price is very high and which, going forward, has the extremely high deductible. This high deductible was actually madated by law. The reason for it (as explained to me) is that many homeowners were taking advantage of sinkhole coverage to get minor cracks, etc. repaired in their houses. They would work the system like this: They would make a claim on their sinkhole coverage that a sinkhole has caused minor damage to their homes. The insurance company would then have to hire geophysical engineers to evaluate whether there was a sinkhole. These evaluations were extremely expensive ($12-15K). Because of this, the insurance companies found it cheaper to just pay the claims rather than pay for the evaluations. So, in the end, the homeowners were able to get the insurance companies to pay for minor cracks and normal settling damage.

By raising the deductible to $20,000 or whatever it works out to on an individual property, this scam is avoided. However, since catestrophic coverage for sinkhole is already covered (with a very nominal deductible), it makes me question the additional value of the sinkhole rider for non-catestrophic damage since there's a good chance that such damage will be less than the deductible, anyway.

Thank you for your research and this clearly-worded post. I found it very helpful.

[janmcn]

Originally Posted by NJblue

I just went through this (rate increase) and this is what I found in my research in talking with people at AAA as well as The Villages Insurance:

Every policy in Florida is required to have "catestrophic" sink hole coverage. This is included in the basic price of the policy and typically will have the same deductible as you would for any other sort of loss (except hurricane which will have a higher deductible). This covers you in the case a sink hole suddenly opens up and makes your house unliveable (as defined by the county, I believe.) There are certain conditions that must be met for this to apply (e.g., house unliveable, sudden versus slowly over time, etc.)

In addition, you can buy an additional rider for sink hole coverage which covers you in the cases not covered by the above conditions. This is the component whose price is very high and which, going forward, has the extremely high deductible. This high deductible was actually madated by law. The reason for it (as explained to me) is that many homeowners were taking advantage of sinkhole coverage to get minor cracks, etc. repaired in their houses. They would work the system like this: They would make a claim on their sinkhole coverage that a sinkhole has caused minor damage to their homes. The insurance company would then have to hire geophysical engineers to evaluate whether there was a sinkhole. These evaluations were extremely expensive ($12-15K). Because of this, the insurance companies found it cheaper to just pay the claims rather than pay for the evaluations. So, in the end, the homeowners were able to get the insurance companies to pay for minor cracks and normal settling damage.

By raising the deductible to $20,000 or whatever it works out to on an individual property, this scam is avoided. However, since catestrophic coverage for sinkhole is already covered (with a very nominal deductible), it makes me question the additional value of the sinkhole rider for non-catestrophic damage since there's a good chance that such damage will be less than the deductible, anyway.

From what I've read, mostly on this forum, having a sinkhole filled in could cost tens of thousands of dollars depending on how much cement is needed to fill the hole and where on the property the sinkhole developed. Perhaps someone who has experienced this can post accurate information.

[784caroline]

Regarding the sinkhole scam here is what I think was happening.

You had sinkole coverage and it was only $500 deductible. You have cracks in your walls and stuccco. Call your insurance comapny and they say if you can show us that the cracks are from sinkhole activity, we will reimburse you for the soil tests (upwards of close to $10K) and then work with a company to pay the claim. In many cases the claim equaled 80% the insureable value of the home...(not resale value) and teh insurance comapny simply paid the full value of the policy and said the house would not be insurable for future sinkhole claims.

Now this is when teh scam starts.....if a house has a resale vale of $300K less property value of $50K..the insurance company pays off $250K....and the epople do not want to live there. The sinkhole company who did the estimates makes an offer to buy the house for somewghere between $25-50K which would make the effected party good in terms of dollars and simply walks away. The sinkhole company makes cosemetic repairs and resells the house on teh open maket for $225 -250K...pocketing close to $200K. Discloures are only required between the first seller and buyer so the new buyer has no idea what has haoppened to that property unless they do some due dillegence.

Current day..... BY raising the sinkhole deductible to 10% it makes the houses more expensive for these companies to buy the home and it makes the homeowner think twice if they want to file a claim and risk/gamble with the higher numbers....no easy way to get out from the property.