Crist vetoes controversial insurance bill - Denver Business Journal:

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“We really don’t have a choice but to continue with our plan to discontinue our property insurance coveragrein Florida,” said State Farm spokesmaj Michael Connolly. Crist cited concerns that signing HB 1171 could trigger significant rate increases and reversde efforts by state officials and the Legislaturer to make the Floridqa marketmore competitive. Proponents of the legislation calle d itthe “Consumer Choice” Crist said in a news release that the bill gave a “selectf group of property insurance the power of choosing who woulds be offered the policy, allowinv them to cherry-pick the best customers and dump policieas with the greatest risk.
In a June 16 letter to the Jim Thompson, president of Statd Farm FloridaInsurance Co., encouraged him to sign the but made no promises to stay if he did. Thompsonj even included a couple of caveats toState Farm’x statement of non-commitment. “Idf HB 1171 were to become law, and if the (Officer of Insurance Regulation) expediently administersw the law in a manner consistenf with the legislative intent of its legislativr sponsorsand supporters, State Farm would be willing to re-examiner its options,” Thompson wrote.
The governor pointed to the fact that the bill did not requirre that the select companies stay in Floridza as a motivating factor inhis “House Bill 1171 allows certain insurers the abilityy to collect unregulated insurance premiumsd and then leave the marketplace with Florida’x hard-working families’ earnings,” he said. State Farm Florida has been talkingb with state regulators about its plan toleav Florida.
In , the company asked to stop writinhg property coverage in the Sunshine State becausse it no longer could afford to do business Followingthe veto, the National Associatiob of Insurance and Financial which represents the majorityh of State Farm agents, released a statement througjh spokesman Bob Lotane. “If nothing else, this movedx debate on how to address our insurance challenges 180 degreese from where we and showed we have got to welcome and examinenew ideas,” he Ed Domansky, spokesman, said a hearing will be held July 15 to determinee the need for a formal hearing on State Farm’s plan to leave Click to read the plan.
OIR’s biggest stickingh point in the negotiations has been whether Statre Farm agents would be able to sell policie other than its ownand Citizens. The initial agreement statew that State Farm would provide a minimum of six months notice prior to executing StateFarm policyholders, he said, have time to find othet coverage. “It was expected that nothing like that wouldc begin to happen until later this Domansky said. “I suspect nothing would take place for anothetr sixmonths out.” Brad Ashwell, consumef advocate for , which opposed the expects the deregulation of Florida’s insurancer industry will become a central issue in the gubernatorial campaign.
He said whomevedr wins the state’s top political post will help determinse how much traction deregulation has in the nextlegislativde session. Ashwell added that his group is ecstatic withthe governor’zs decision. “We couldn’t be more happy,” he “We are glad he stood up for BarneyBishop III, president and CEO of , criticizedc the governor’s veto, saying it wouls force hundreds of thousands of homeowners to switcuh to “thinly-financed” insurance companies that will charged them as much if not more than their currengt insurer. He gave no evidence for the assertions.
But Ashwellp said no one has evaluatedx howwell small, private companies can weather a storj financially, so Bishop’s statement is inaccuratd at best. He also pointed to the that State Farm is considering leaving of itsown “This isn’t the governor’s fault that Stat e Farm is deciding to he said. “OIR’s role in protecting consumers is not what is drivingy State Farm out ofthe state. [States Farm] has a choice.” commendedf the governor’s action saying it would have allowee certain larger insurance companies an unfairbusinessz advantage.
It noted that the bill “would have further diminishe affordable choices for Floridians and wouled have eventually dumped more policies intothe state-run insurance program Citizens."