The AP (2/4, Kallestad) reports, “State Farm Florida has lost hundreds of millions of dollars in the state in the last decade and risks insolvency if it continues writing property insurance here, company executives told a legislative committee Tuesday” and “Jim Thompson, president of State Farm Florida, told the House Insurance, Business & Financial Affairs Policy Committee on Tuesday that the company must stop its financial bleeding to ensure it can pay off future claims.” He said, “This is a day that we hoped would never come for State Farm.”
WSJournal blasts Crist’s handling of Florida hurricane insurance. The Wall Street Journal (2/4), in an editorial, writes, “Last month State Farm pulled the plug on its 1.2 million homeowner policies in Florida, citing the state’s punishing price controls. The state’s largest insurer joins a raft of competitors that have already reduced or dumped their property and casualty business. … This is the inevitable result of Governor Charlie Crist’s drive to control property-insurance premiums.” The Journal continues, “Meanwhile, Floridians have been signing up with Citizens Property Insurance Corp., the state-run insurer that Mr. Crist unleashed in 2007. … Crist has thus guaranteed that Floridians, rather than the global insurance industry, will be on the hook for property damage when the next Katrina hits. Citizens is facing more than $400 billion in potential exposure, yet” Citizens Chief Financial Officer Sharon Binnun says “it had only $3.4 billion in net assets.” The Journal concludes, “It’s scary to imagine the bill taxpayers will get when the next big hurricane hits Florida. It’s even scarier to think Mr. Crist is being touted as a potential GOP candidate for the White House.”
From the American Association for Justice news release.