Listen:
Florida’s House Speaker Daniel Perez announced this week that he was starting a committee to investigate the finances of property insurance companies amidst the state’s insurance crisis.
It was sparked by a Tampa Bay Times report showing Florida insurance companies claimed to be losing money while their parent companies and affiliates were making billions.
WMNF’s Chris Young spoke with Tallahasse correspondent for the Tampa Bay Times and Miami Herald Lawrence Mower, who, after a two-year public records request wait, published a well-guarded study revealing the insurance companies’ profits some may consider shady.
MOWER:
This is no secret. This has been going on for decades now – is that these affiliate companies will overcharge the insurance company for those services, and that’s basically what this report reflects. It shows that, you know, in this author’s estimation, most of the domestic companies that were in this study were overbilling for those services. T he services, the cost of the services was, in this author’s estimation, not fair and reasonable under state regulations.
YOUNG:
And what effect would that have for property insurance customers in Florida?
MOWER:
A massive effect. It’s basically everything. As soon as the money leaves the insurance company and goes to an affiliate, for the most part, it’s no longer available to pay claims, and so, you know, the company has less money to pay claims. and of course, it makes the companies financially weaker in many cases, and of course, more vulnerable to going out of business, and of course, Florida has seen a number of these companies go out of business. And one of the common threads and probably the most common thread, according to the state reports about those insolvencies, is that too much money was going out of the insurance companies.
YOUNG:
And obviously this report was impactful. Did you expect this to cause such an uproar and spark a full-fledged legislative investigation?
MOWER:
No, not necessarily. I mean, I’ve been reporting on the use of affiliate companies in the history here for a while now. I think maybe it had an effect because this is a state report, and also because this was a state report that was never given to lawmakers. And even when lawmakers were holding emergency legislative sessions to deal with the insurance crisis, this was something they never saw. This is an issue that was brought up by several lawmakers at the time saying, ‘hey, what about the use of these affiliate companies? Shouldn’t we be looking at that? And so I think it upset some lawmakers, the fact that this was never given to them, but, yeah, I mean, I would say I’m, I’m a little bit surprised.
Listen to the full interview:
Leave a Reply
