FAIR Federal Association for Insurance Reform

FAIR Federal Association for Insurance Reform A consumer advocacy group whose mission is to provide insurance consumers with affordable rates for quality coverage through balanced public policy.

We advocate for fair, transparent and affordable insurance markets for consumers, through leadership, education and robust competition.

Florida's insurance market has seen improvements following recent reforms aimed at addressing high premiums and insurer ...
03/05/2025

Florida's insurance market has seen improvements following recent reforms aimed at addressing high premiums and insurer insolvencies. These changes, led by Gov. Ron DeSantis and the Legislature, have helped stabilize the market, attracted new insurers, and provided homeowners with more options. As a result, more than 10 new insurers entered the market in 2023, fostering competition and potentially lowering costs.

Kevin McCarty, a former Florida Insurance Commissioner, advises against introducing new changes too soon, as the effects of recent measures are still unfolding. McCarty points out that 17 companies have filed for rate decreases since January 2024, and 34 others have requested no increases. Over time, these adjustments are expected to benefit consumers.

External factors, like natural disasters, rising reinsurance costs, and past litigation abuse, continue to challenge the market. However, reforms addressing these issues, including measures to reduce litigation and enhance insurer accountability, have been implemented. McCarty emphasizes that it's important to allow time for these changes to stabilize the market further before considering additional legislative action.

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Florida's insurance reforms are working, let them take effect.

Neptune Flood has released a report proposing a transition of NFIP policies to the private market to reduce government f...
02/20/2025

Neptune Flood has released a report proposing a transition of NFIP policies to the private market to reduce government financial exposure. The report highlights two main issues: excessive government subsidization of flood risk and overdevelopment in high-risk areas, especially properties with repeated flooding. These factors have led to an inefficient system where risk is mispriced, and taxpayer money supports an unstable program.

Neptune Flood's analysis suggests that 95% of NFIP policies meet private market underwriting standards, and many policies could benefit from lower premiums in the private market. The report recommends removing federal subsidies, creating a program to transfer policies from NFIP to private insurers, and implementing state-level subsidies or federal tax credits for affordability.

Neptune's CEO, Trevor Burgess, emphasized that the current NFIP structure is unsustainable and that the private sector, equipped with advanced risk assessment tools and reinsurance, can provide better, more competitively priced coverage. He called for a well-managed transition to reduce taxpayer burden and offer homeowners insurance that accurately reflects their risk.

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Neptune Flood, a provider of private flood insurance in the United States, has unveiled a roadmap for transitioning National Flood Insurance Program

A new bill introduced in Florida aims to reduce insurance costs but faces opposition from the industry. The bill, filed ...
02/19/2025

A new bill introduced in Florida aims to reduce insurance costs but faces opposition from the industry. The bill, filed by Rep. Alex Andrade in the House and Sen. Don Gaetz in the Senate, seeks to reverse restrictions on attorney fees and mandate full disclosure of insurer financial operations. Gaetz, a veteran Florida politician, argues that high insurance costs burden Floridians and hurt the state's economy.

The bill proposes reinstating a system where plaintiffs’ attorneys could recover full fees if insurers offer a settlement significantly higher than the initial demand. It also requires insurers to disclose subsidiaries, compensation of executives, and how money is used for rate setting.

FAIR President, Paul Handerhan, expressed concerns about the proposed bill’s provisions regarding insurer disclosures. He said that the Florida Office of Insurance Regulation already requires insurers to submit detailed reports about their financial activities, including expenditures and contracts with affiliates. However, these reports are not made publicly available because they contain proprietary business information. He stressed that the insurance commissioner thoroughly reviews these documents to ensure that insurers are transparent in their financial dealings, including any contracts with subsidiaries or affiliated companies.

Despite strong opposition from the insurance sector, Gaetz remains committed to reforming the industry, but he acknowledges the bill may face significant hurdles in the legislature.

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A political titan has filed a provocative bill he says will reduce insurance costs in Florida— and the insurance industry doesn "t like his proposals. Don Gaetz, R- Crestview, a longtime heavyweight in Florida politics and father of former U.S. Rep. “Floridians pay far more for property insuranc...

FEMA borrowed $2 billion from the U.S. Treasury to cover National Flood Insurance Program (NFIP) claims after major floo...
02/11/2025

FEMA borrowed $2 billion from the U.S. Treasury to cover National Flood Insurance Program (NFIP) claims after major flooding from Hurricanes Helene and Milton. These events led to over $5.2 billion in claims, with total losses estimated between $7.4 to $10.3 billion. While NFIP premiums usually cover claims, 2024's catastrophic floods depleted its funds. FEMA has borrowed a total of $22.525 billion from its $30.425 billion borrowing authority and remains committed to paying all eligible claims.

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FEMA has exercised its borrowing authority under the National Flood Insurance Act of 1968 to borrow $2 billion from U.S. Treasury to pay eligible National Flood Insurance Program (NFIP) policyholder claims.

Chairman Tim Scott (R-S.C.) announced the formation of working groups within the Senate Banking Committee to address key...
01/29/2025

Chairman Tim Scott (R-S.C.) announced the formation of working groups within the Senate Banking Committee to address key issues affecting the U.S. economy. These groups aim to build consensus and find solutions to longstanding challenges. The groups will focus on the following:

National Flood Insurance Program- efforts to reform the NFIP, ensuring its long-term sustainability and helping communities better prepare for and recover from flooding.

Protecting Main Street Investors - reforming the shareholder voting process, aiming to reduce undue influence from activists and protect American investors' interests.

Reforming Federal Financial Regulatory Agencies - enhancing regulatory transparency and efficiency, addressing burdensome regulations to create a fairer and more transparent financial system.

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The Official website of The United States Committee on Banking, Housing, and Urban Affairs

FEMA said its reinsurance renewal for the NFIP included the transfer of nearly $758 million to the private market throug...
01/22/2025

FEMA said its reinsurance renewal for the NFIP included the transfer of nearly $758 million to the private market through the use of 27 reinsurance companies – up from 18 companies a year ago.

Elizabeth Asche, FEMA’s assistant administrator for federal insurance and senior executive of NFIP said the agency’s use of more reinsurers strengthened its “commitment to use private sector reinsurance to enhance the NFIP’s ability to pay flood insurance claims.”

The 2025 reinsurance placement covers portions of NFIP losses above $7 billion from a single qualifying flood event. FEMA will pay total premium of about $140 million for the coverage.

The agreement is structured to cover:

about 12% of losses between $7 billion and $9 billion
about 26% of losses between $9 billion and $11 billion

Combined with the three capital markets reinsurance placements in 2022, 2023 and 2024, FEMA said it has transferred about $2.1 billion of the NFIP’s flood risk to the private sector. If a named storm flood event is large enough to trigger all reinsurance agreements, FEMA will receive qualifying payments.

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The Federal Emergency Management Agency (FEMA) said its reinsurance renewal for the National Flood Insurance Program (NFIP) included the transfer of

After Hurricane Milton, Sean Young returned home to find that several pine trees had crashed onto his roof, causing exte...
10/30/2024

After Hurricane Milton, Sean Young returned home to find that several pine trees had crashed onto his roof, causing extensive damage. With help from his mother-in-law, he managed to remove the trees at a personal cost estimated between $5,000 and $10,000, but remains uncertain about how much, if any, of the expense will be covered by insurance or if the county is responsible, given that the trees came from county-owned land.

Pinellas County officials stated they wouldn’t cover tree removal costs on private property, even after hurricane damage, which leaves homeowners relying on insurance. Insurance typically covers damages to structures but only offers limited funds for tree removal if the trees threaten the property directly. Young’s dilemma reflects the challenges many in Pinellas County face with insurance claims and tree removal costs after a storm.

FAIR President, Paul Handerhan, advised policyholders to document damages in detail and manage their own claims carefully: “It’s best to take pictures of your home before and after the storm…take clear and numerous pictures of the damage.”

It’s best to take pictures of your home before and after the storm, but in the absence of pre-storm pictures, take clear and numerous pictures of the damage. Make sure to send in itemized receipts. Insurance companies may dispute a large bill for tree removal, for example, if it’s possible trees were removed that weren’t a threat to the home, or extensive renovations were made without an adjuster’s inspection.

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Roof damage — from tree punctures to scattered shingles — is widespread after Milton. Here’s how to scout contractors and get paid back for repairs.

Despite warnings from major insurance rating agencies, experts in Florida’s home insurance industry believe the market c...
10/14/2024

Despite warnings from major insurance rating agencies, experts in Florida’s home insurance industry believe the market can withstand the impact of Hurricane Milton and is prepared for another storm. AM Best and Fitch Ratings cautioned that Milton could strain the liquidity of Florida-based insurers, particularly those heavily reliant on reinsurance and lacking diversification. Fitch raised concerns about insurers’ low surplus levels, increasing the potential difficulty in raising capital after significant losses. However, FAIR President, Paul Handerhan, argues that these agencies do not have full insight into the reinsurance programs of Florida-based insurers. Handerhan noted, “AM Best and Fitch don’t have direct access to their reinsurance programs or financials.”

Florida insurers have already secured enough reinsurance to handle multiple storms, including Milton. Although Milton is expected to cause significant insured losses, other recent hurricanes, Debby and Helene, did not cause extensive enough damage to exhaust reinsurance reserves. Handerhan emphasized that there are no immediate risks of insolvency, and Florida regulators will ensure that insurers have sufficient reinsurance for future events.

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AM Best and Fitch Ratings each issued reports last week warning that Milton could stretch liquidity of Florida- based insurers that are primarily focused on protecting in-state homeowners. "Hurricane Milton poses a significant threat to the Florida property insurers concentrated in the state that la...

Keeping up to date on the weather is important now more than ever.See here for ways to stay informed, even without power...
10/08/2024

Keeping up to date on the weather is important now more than ever.
See here for ways to stay informed, even without power :

Channel 9 is committed to keeping you informed as Hurricane Milton passes over Florida.

Bryan Zoller, a Bradenton, Florida resident of 20 years, is making his first insurance claim after Hurricane Helene caus...
10/03/2024

Bryan Zoller, a Bradenton, Florida resident of 20 years, is making his first insurance claim after Hurricane Helene caused flooding in his home near the Manatee River. Zoller is among only about 20% of Florida homeowners with flood insurance, a number expected to rise after the storm. Experts, like Chad LaTour of Flood Risk Solutions, believe this event will prompt more people to purchase flood insurance, even in low-risk areas, and suggest lenders should require it. However, private insurers are unlikely to impose such mandates due to competitive disadvantages, according to Professor Chuck Nyce from Florida State University.

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It’s estimated less than 25% of FL property owners are covered by flood insurance. Investigative reporter Katie LaGrone looks at whether flood insurance should be required by our state in the future.

Rising floodwaters globally threaten communities and economies, making accurate flood risk assessment crucial for effect...
08/29/2024

Rising floodwaters globally threaten communities and economies, making accurate flood risk assessment crucial for effective flood insurance. Traditional methods like elevation certificates are often costly and inefficient. CoreLogic’s Flood Risk Score enhancement addresses these issues by offering a detailed suite of data elements—such as First Floor Height, Lowest Adjacent Grade (LAG), and granular Water Surface Elevation (WSE)—to improve flood risk assessment accuracy.

The enhancement utilizes AI technology to analyze property images, automating the process of determining structural elevation. This approach not only reduces reliance on costly elevation certificates but also provides a more detailed and precise assessment of flood risk, including areas outside traditional flood zones. It enhances efficiency by integrating into platforms like CoreLogic RiskMeter Online® and Spatial API.

Overall, CoreLogic’s Flood Risk Score enhancement represents a significant advancement in flood insurance, offering insurers a more accurate, efficient, and reliable way to assess and manage flood risk amid increasing climate-related challenges.

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This post is part of a series sponsored by CoreLogic. Rising floodwaters pose a significant threat to communities and economies worldwide, making flood

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