While Citizens Property Insurance Corp. continues to be a topic of interestfor Floridians across the state, including how policyholders in certain areaswill be able to afford potential, future rate hikes, some members of Congresshave proposed federal legislation that is also cause for concern.
Rep.Richard Neal, D-Mass., and Sen. Robert Menendez, D-N.J., are working together onHR 3157 and S 1963, which aim to levy costly tariffs on global insurancecompanies.
These global insurance companies, which provide nearly two-thirds of allre-insurance in the United States, help spread insurance risk throughout theworld and are essential to the livelihood and well-being of consumers andbusinesses affected by natural disasters such as hurricanes.
Living in a hurricane-prone state that is dealing with its own insurancedilemma, the return of a healthy, private market relies heavily on privateinsurance and re-insurance companies. The business community realizes the needto spread our states risk globally instead of concentrating it within thestate, and a tax increase which will be passed on to all Floridians isnothing more than a step back for Florida.
In 2010, a study conducted by the Brattle Group found that as a result of this legislation, the price of insurance in this country would increase by asmuch as 9 percent on some lines of business. In Florida alone, the studyprojected that some businesses could see their insurance bills radicallyincrease with the price of commercial multiperil insurance soaring by 12.6percent which is a staggering $264 million a year in added costs forFlorida businesses.
On behalf of the Associated Industries of Florida, I urge you to contact yourmembers of Congress and urge them to vote against HR 3157 and S 1963. Thislegislation is the last thing Florida needs at a time when we are trying torevitalize the private insurance market and reduce the size of the overrunstate insurer of last resort.
Thomas C. Feeney, III is president of Associated Industries of Florida.
