A recent decision by State Farm to discontinue serving residential insurance policies in Florida has left state lawmakers with an insurance mess. Floridians are finding themselves at the mercy of other insurance companies who may be taking advantage of new customers.
Randi Schuknecht, a Tallahassee elementary school teacher found that his new policy issued by another company would cost him approximately $400 more annually than his previous policy with the insurance giant.
Florida lawmakers are schedule to convene on March 2, 2010, and plan to tackle the insurance mess left behind by State Farm. The goal is to figure out a way to make sure that insurance companies remain profitable while offering customers affordable insurance, especially in light of the upcoming hurricane season.
The fear for lawmakers is that if insurance companies are unable to payout then the state could be on the hook for billions of dollars. A few solutions have been brought forth by lawmakers.
"We have a long way to go," said Senate President Jeff Atwater, R-North Palm Beach. "How we get there, I don't know."
Some of the proposals that have been brought forth leave premium rates up to the discretion of the insurance companies. This could mean significant rate hikes for policyholders.
"It's time, we're going to have to come to grips with the reality we're going to pay rates equal to the risk," said Rep. Bill Proctor, R-St. Augustine.