Bill Newton, Executive Director of the Florida Consumer Action Network (FCAN) stopped by the WMNF studios to discuss the rising cost of homeowners insurance. Many large insurance companies are cancelling policies. The MIAMI HERALD reported this week that:

"Gov. Jeb Bush signed a massive insurance reform bill into law Tuesday that attempts to stabilize the state's insurance market and provide a smidgen of relief for beleaguered Florida homeowners.

Yet many lawmakers and industry experts concede the new law isn't perfect. Some say it's time to consider some out-of-the-box solutions for the state's insurance crisis.

The bill, which lawmakers began working on as South Florida was still cleaning up after being walloped by Hurricane Wilma last fall, contains ''tough choices,'' said Bush, but ``it will help sustain a private insurance market over the long haul.''

Critics of the new law say it fails to lower insurance costs for consumers. Some believe it gives the insurance industry too much power and guts the authority of the state's Office of Regulation, which oversees insurers.

One controversial provision in the new law allows insurers to raise rates an average 5 percent statewide and an average 10 percent in a region without regulator approval.

The new law does appropriate $715 million to pay down a portion of Citizens Property Insurance's $1.7 billion deficit for 2005. This reduces the assessment on all Florida homeowners to about 2.5 percent this year and a smaller 1 percent assessment spread over 10 years. Homeowners had been facing an assessment up to 20 percent or $200 per $1,000 of premium.

The bill also extends a helping hand to homeowners by setting up a $250 million fund to provide low-cost loans that can be used to make homes more storm-resistant. Details of the plan have not been worked out yet.

Supporters hope this law will bring new insurance companies to Florida, a state that has seen insurance companies pull back dramatically. Last week, Allstate Floridian announced it would drop 120,000 home and condo policies, including 34,500 in South Florida, starting later this year.

To help insurers, $250 million from state coffers will be used to provide surplus loans to insurers to help beef up their capital. The insurers would be required to match state funds with capital from private sources.

Yet the new insurance measure does very little to lower insurance costs for consumers. In fact, Citizens policyholders will see steep rate increases on top of assessments.

Last week's news that State Farm, Florida's biggest home insurer, is seeking to raise rates an average of 70 percent for home and condo owners is propelling some lawmakers to call for yet-untried solutions."

Bill Newton of FCAN said the solutions to the problem include requiring insurance companies to not cherry-pick customers; to discourage building in high risk areas such as barrier islands and lowlands; and to spread the risk over the entire state. Look for more about Bill's ideas on the FCAN web site.

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