How many of us want additional fees to be levied to our homeowner policies to pay for the failed management of other homeowner companies?

Effective January 14, 2008 for most insurance companies, a third Florida Insurance Guarantee Association (FIGA) assessment will apply to new business, endorsement, and renewal premiums.This surcharge, 1.5% of written premiums, will be charged until the insurance company has recouped the assessment already paid to FIGA.

There are now a whopping total of six assessments that are being charged to insureds. All insurance companies are subject to assessments, as required by state law. Any future significant storm activity will likely result in companies passing along additional assessments from Citizens Property Insurance Corporation, FIGA, and/or the Florida Hurricane Catastrophe Fund.
These are not “premiums” since insurance companies do not get this money, and agents do not get commission on it, but many consumers may not realize that this cost is not for their insurance, but actually constitutes a subsidy for others. As an example, the FIGA assessments are for claims ultimately not paid to Florida policyholders by liquidated insurance companies.

The six assessments that are being charged to home policies are:
1. Florida Insurance Guarantee Association 2006 Assessment.
2. Florida Insurance Guarantee Association 2006 Special Assessment.
3. Florida Insurance Guarantee Association 2007 Assessment.
4. Citizens Property Insurance Corporation 2005 High Risk Account Regular Assessment.
5. Citizens Property Insurance Corporation 2005 High Risk Account Emergency Assessment.
6. Florida Hurricane Catastrophe Fund Emergency Assessment.

The above, as applicable, will be detailed on the Declaration Page of the respective policies. The latest FIGA assessment should be displayed as: Florida Insurance Guarantee Association 2007 fee.

These fees average over $100 on most policies. The higher the premium costs on the policy then the higher the fees to be paid. While companies strive to lower rates the fees keep on coming and these fees don’t go away easily until completely recouped.

Purchase your insurance from reputable companies with adequate reserves and encourage others to do so as well so we can all avoid paying for failed companies and their failed business strategy.

Greg can be reached at 407-215-7318 or cheapinsurance@bellsouth.net

On October 1, 2007, Florida’s No-Fault Automobile Insurance system, also known as Personal Injury Protection, or PIP, expired. Before its sunset, Florida law required that every driver carry $10,000 in personal injury protection insurance to ensure that motorists involved in accidents have the ability to pay for their medical treatment and associated expenses. PIP pays the policyholder’s benefits no matter who was at-fault for the accident. Over the years since the no-fault law was enacted, the system has become a source of fraud in Florida, and so the Legislature has agreed to the return of PIP with some additional consumer protections.

Effective January 1, 2008:

• The requirement to carry Personal Injury Protection will return for Florida drivers
• Drivers must still carry $10,000 in PIP coverage to protect them in case of an accident

To combat cases of fraud:

• PIP reimbursement will be available only to reputable and qualified providers
• Reimbursement will be determined by a fee schedule to control unnecessary costs
• Expands time given to insurers to investigate erroneous claims from 45 to 60 days
• Grants increased power to the Attorney General to investigate and punish insurance companies that systematically and wrongly deny PIP reimbursement claims
• Reimbursement priority is given to hospital doctors and dentists to protect emergency care providers, of which Florida currently has an ongoing shortage
• Claims processing will be streamlined by requiring the merging of similar claims and encouraging electronic transmissions
• Drivers will be required to prove and maintain Property Damage Liability coverage when registering their vehicle
• All policies that were in effect on September 30, 2007 that do not expire before January 1, 2008 will have the same PIP benefits and tort immunity they had on September 30, 2007 reinstated. The new reforms will be required January 1, 2007.
• Drivers with policies that expire before January 1, 2008 will voluntarily be able to purchase any type of coverage they choose. If the insured chooses to purchase PIP benefits, they will also have tort immunity.

Other Auto News Changes:

Drive Drunk? Think again before you do….

In response to Florida Statute 324.023, auto insurance companies will require all policies that have a driver with a DUI with an occurrence date of 10/01/2007 or later to carry policy coverage of $100,000 liability per person / $300,000 liability per accident and 50,000 property damage liability. This means in essence these drivers will be required to carry at least 10 times the minimum coverage as required by the state. This requirement will follow that driver for a minimum of 3 years.