Florida to Insurers: Comply With New Laws or Else

The Florida Insurance Commissioner has put homeowner’s insurance companies on notice they had better comply with new insurance laws.

Otherwise, Kevin McCarthy says they will face state action.

Homeowners eligible to drop expensive wind insurance - which has been allowed since July 1 - are complaining that insurers say they don’t have the proper forms or the state hasn’t approved revised rates yet.

The result: Many homeowners such as Joe Rocco of Miramar are getting the runaround instead of the long-awaited price break that state legislators decided they deserved.

Rocco wants to get rid of the expensive hurricane coverage on his mother Carmela’s house in Miramar. The requirement for consumers to drop wind coverage is having their Florida mortgage paid off or the off-chance they can get permission from their lender to go without the insurance.

The Rocco’s Florida home mortgage was paid off decades ago.

Yet Rocco’s insurer, State Farm, balked. Rocco said his agent initially told him it’s because State Farm must wait until the state approves new rates in October.

“I guess their hands are tied also,” Rocco said. “They don’t know how to write this [policy] and they don’t want to use the rates from last year.”

McCarty sent a memorandum to insurers Tuesday that says insurance companies that fail to do whatever necessary to comply with the new laws would be “subject to administrative action.”

Florida adopted two insurance laws, one in January and the other in June, that required homeowner’s insurance providers to offer policies without windstorm or property contents coverage starting July 1.

The insurance commissioner’s memo means the state could perhaps levy fines on insurers who aren’t offering consumers these options, said Tom Zutell, a spokesman for the state Office of Insurance Regulation.

Of course, policies that don’t have wind coverage are far cheaper than those that do. Rocco’s windstorm premium would be $3,300 this year, up from $1,600 last year. On Tuesday, Rocco said he’s still trying to resolve the issue with his insurance agent.

Nicole Watson, who lives in Stuart and still owes a small amount on the Florida mortgage on her Martin County home, is in the midst of trying to drop her windstorm coverage.

Her Florida mortgage lender has given the okay. The mortgage company even called her insurance company, Hull & Co., to ask why Watson was refused the request to drop the coverage.

Watson would have to pay the Fort Lauderdale insurer $4,400 for a policy that carries a $9,200 annual deductible. She says she can’t afford it.

“The insurance agent basically told the mortgage company, ‘This really is none of your concern,’” said Watson. “But I can’t find anyone else to offer me fire and liability coverage.”

Its unclear how many people are in the boat with Rocco and Watson.

Most homeowners have Florida mortgages and would be unable to qualify for policies without wind insurance coverage. Moreover, many people still want it, considering the risk of hurricanes in Florida.

Continue reading in the South Florida Sun-Sentinel …