Posted On: April 13, 2007, 3:24 pm CDT

Posted By: Actuary

If a National Cat Program charges actuarially sound rates to the various states/localities, no subsidies will result, but neither will significant rate decreases. What FL officials driving this really want is a subsidized program, which is why they don't get much support from other states.

Florida legislators and the OIR think the problem is insurer and reinsurer profits, so they keep pushing the private market out of the state with government assessment programs masquerading as insurance. Unfortunately, FL residents will find out soon enough the difference between an actual transfer of hurricane risk and a system of post-event assessments.

For those comparing states, according to Property Insurance Report, Florida ranks 4th in the nation for average Homeowner insurance rates, behind Texas, Louisiana, and Oklahoma. As a percent of median income, Florida is 5th, behind the states above plus Mississippi.