Friday, September 22, 2006

Sink Issues Plan to Address Property Insurance Crisis

The Democratic candidate for CFO, Alex Sink, released a 5 point plan to address Florida's worsening property insurance crisis:

(1) A Strong Insurance Consumer Advocate
As Chief Financial Officer, I will be a strong insurance xonsumer advocate that stands up for families and
businesses who buy property insurance in Florida. As your insurance consumer advocate, I’ll fight to control the exploding cost of property insurance. If insurance companies are refusing to pay legitimate claims, I’ll make them pay. And I’ll take steps toward making sure that Florida’s consumers have insurance policies that describe in plain language exactly what is – and what is not – covered.
(2) An Innovative Regional Solution
The problem of violent weather is a national problem, and we need a national catastrophic fund to spread the risk. But Congress can’t get its act together even after a major disaster like Hurricane Katrina. I am not going to wait for Congress any longer. As Chief Financial Officer, I will call all of my
counterparts in coastal states from Texas to Maine and work with them to discuss the creation a regional catastrophic fund that helps spread the risk of tropical weather.
(3) A Stronger Florida Catastrophe Fund
We need to expand and strengthen the Florida Hurricane Catastrophe Fund. A stronger “CAT Fund” will establish a more predictable property insurance market and attract more
private competition for our insurance business. One of the reasons for high insurance rates is the cost of “reinsurance”­– backup insurance that insurance companies buy to cover payment of claims. Through the CAT Fund, the state is able to leverage cheaper reinsurance rates for private insurance companies. There are several proposals to expand the state’s
involvement in providing reinsurance, and reducing the cost of re-insurance will help to lower rates.
(4) Fighting Insurance Fraud
As Chief Financial Officer, I will be the state’s top prosecutor of insurance fraud. According to the Coalition Against Insurance Fraud, insurance fraud costs each Florida family an additional $1,500 per year in increased premiums. In fact, according to
the National Insurance Crime Bureau, fraud can inflate premiums by as much as 30 percent. As Chief Financial Officer, I will increase the number of fraud investigators and otherwise strengthen anti-fraud efforts so that we have the resources to crack down on the fraud that raises our insurance rates.
(5) Better Hurricane Mitigation
When homeowners take steps to strengthen their homes, those efforts should result in discounts on their property insurance. As Chief Financial Officer, I’ll also fight to unify building
codes around the state and increase other mitigation efforts so that citizens from Pensacola to Fernandina Beach to Key West are ready for storms before they arrive.


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