There are reports that Florida Governor Rick Scott is considering abolishing Citizens Property Insurance. Citizens Property Insurance is a not-for-profit, tax-exempt government corporation that provides property insurance to Florida residents statewide. It has more than 1.3 million policyholders, making it the largest property insurer in the state of Florida. Citizens Property Insurance has offices in Jacksonville, Tampa and Tallahassee. Its headquarters is in the state capital.
Citizens Property Insurance was created in 2002 after being signed into law by then-Governor Jeb Bush. The purpose of the government corporation was to be the insurer of last resort for those who were otherwise unable to obtain property insurance. Former Governor Charlie Crist had expanded and reformed Citizens Property Insurance several times in recent years.
Pulitzer Prize-winning journalist Paige St. John of the Sarasota Herald-Tribune reports that even the private insurance companies who have sought the elimination of Citizens Property Insurance were alarmed by Governor Scott's plan. Lobbyists for the insurance industry are concerned that they will be unable to absorb the hundreds of thousands of policyholders who would find themselves without insurance should Citizens Property Insurance be shuttered. If the private insurance market proves unable to absorb these policyholders, they may be forced to get property insurance from the surplus lines market. The surplus lines market is largely unregulated and its policies are not backed by the state.
Governor Scott took some "friendly fire" from GOP state lawmakers over the proposal. "He's clueless. The governor is clueless as to what is happening throughout the state, and the burden on home owners and condominium owners and business owners," said Mike Fasano, a Republican state senator from New Port Richey. Another Republican, state representative Jim Boyd of Bradenton, said "there's always going to be a need for" Citizens Property Insurance (or something like it) because there is "some property that can't be written by the private market."
Mike Thomas of the Orlando Sentinel has a different take. The effect of Citizens Property Insurance is to "make sure people in Orlando continue subsidizing property insurance on the coast," writes Thomas. Janet Zink of the St. Petersburg Times notes that approximately "72 percent of Citizens' revenue in 2009 came from assessments paid by Floridians through their property, automobile and other types of insurance." So eliminating Citizens Property Insurance would presumably save many Florida residents some money through lower insurance assessments.
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