Governor Crist vetoes Florida insurance deregulation bill

This bill was supposedly designed to allow Florida's largest homeowner insurance company State Farm to still write policies in Florida and charge the higher rates that they wanted to. Orlando Sentinel article on the subject. Although I certainly don't like the idea of raising insurance rates on anyone or letting big insurers gouge people with high rates, I do believe heavily in the free market economy.

For instance if I as a real estate broker want to charge 15% commissions, you as a consumer have the right to not use my services and go with someone who charges less. The same with retailers - if Dillards charges a higher price than Wal-Mart for the same item, I as a consumer have the right to shop at the cheaper place.

Why should insurance shopping be any different? If State Farm wants to charge $5,000 in premiums and local companies like Security First or Florida Family are willing to charge only $1,000 than why the heck would I pick State Farm. It is all about supply and demand.

Now granted, I do "get it." There are not nearly as many homeowner's insurance companies out there as there are Realtors or retailers, but still why chase off the competition just because they want to charge higher rates. State Farm has already indicated they are leaving. Nationwide stopped writing new policies a few years ago. Allstate canceled 2 of my policies a while back after Hurricane Wilma came through in 2005.

The last thing we need is for the State of Florida owned Citizens Insurance to take on more and more policies and then get blasted by a Hurricane Andrew or Charley. Talk about a real disaster for the taxpayers if that happens. It could bankrupt the state.

Having less competition means higher prices for everyone or the alternative is you simply don't have enough insurers and have to get state run companies like Citizens insuring big portions of the state. And Citizens charges a whole lot more than private companies and they don't issue liability insurance on non-owner occupied properties (meaning rental homes, commercial, vacation homes, etc.)

We all need to pray that we don't have another hurricane season like 2004 or 2005 if State Farm does eventually pull out. Yikes!

---------------------------------------------------------------------------------------------------------------------

(Copyright © 2009. Sand Dollar Realty Group, Inc. All rights reserved.) Subscribe to my blog via RSS feed.

Rob Arnold - Your full service and investor friendly Realtor ® in Orlando and Central Florida.

ABR, CPL, CRB, CSP, GRI, Managing real estate broker, Notary Public

407-389-7318 / 1-877-389-7318 www.SDRhouses.com We Buy Houses Florida

We sell foreclosures, short sales, and bank owned REO properties throughout Central Florida. We sell and list Central Florida real estate and Orlando real estate. Free list of foreclosure and short sale houses available.

I also provide flat fee MLS listings, For Sale By Owner, and menu-based services in most parts of Central & South Florida, the Space Coast, and the Treasure Coast including Orlando, Winter Park, Maitland, Ocoee, Winter Garden, Apopka, Altamonte Springs, Casselberry, Longwood, Winter Springs, Oviedo, Lake Mary, Sanford, Deltona, Debary, Deland, Mount Dora, Eustis, Clermont, Kissimmee, Winter Haven, Lakeland, Tampa, Sarasota, Bradenton, Miami-Dade, Fort Lauderdale, West Palm Beach, Port Saint Lucie, Melbourne, Daytona Beach, Ocala, Gainesville, Palatka, Jacksonville, Volusia, Brevard, and more.