Unless you've been living under a rock here in Florida, you know by that Charlie and the populists (the legislature) have caved in to the "we MUST be subsidized" forces, and soon the Sunshine State will have the most socialized version of home insurance in the country.
From the Orlando Sentinel.
'TALLAHASSEE -- Lawmakers approved a sweeping package aimed at cutting the cost of homeowners insurance in storm-battered Florida but quickly drew heat from consumer groups that say it fails to go far enough to help those staggered by two years of soaring increases.
The wide-ranging legislation is expected to cut rates for property coverage anywhere from 5 percent to more than 40 percent.'
Wow - sounds great! But how does this get paid for?
'But with the state poised to shoulder a larger role in hurricane rebuilding, homeowners could face far bigger bills if another round of major storms pounds Florida.
"At first blush, it's kind of frightening," Senate Banking and Insurance Committee Chairman Bill Posey, R-Rockledge, said of the state's balancing act.
Still, he insisted higher risk was needed to lower bills now."
If you assume there wasn't going to be any relief, these people were going to be bled to death in the next year or so," Posey said. "We tried to stop the bleeding."'
In other words, you took a short-term minor gain for long-term major risk. Like everyone else.
'The House approved the legislation 116-2 and the Senate 40-0, ending a weeklong special session. Republican Gov. Charlie Crist, who repeatedly promised rate cuts during last fall's campaign, is expected to sign the measure into law.'
The last time I witnessed a state legislature vote so overwhelmingly on a hugely important, far-ranging issue? California's deregulation of their electricity market in 1996. And now a history lesson from the recent past...
Similar to our current insurance crisis, people in the Golden State were constantly complaining about their electricity rates being too high. In actuality, it was the commercial users of electricity that did the most complaining. On a per household basis, residential californians use less electricity than in any other state - purely due to the mild climate.
Enron, then a growing tiger in the gas and electricity trading markets, was only too happy to step in and provide the state with a heavy-duty lobbying campaign, telling the state everything they wanted to hear, "Open markets will create competition, and competition will mean lower rates for all!". So, when it came to a vote on giving away the franchise and opening the state's electricity lines to competition, how did it go? Senate 40-0, Assembly 80-0, and passed shortly thereafter by governor Pete Wilson (R).
Unfortunately, just like the baboon-ass monstrosity that just passed in Tallahassee, the lawmakers simply didn't know what they were getting into. It wasn't true deregulation - it's just not possible when everyone has to use the same power lines. It was purely a gamble, based on doctored numbers and charts presented by private parties (Enron) who stood to gain the most from legislation.
As it happened, rates did NOT go down for residential users, and only the largest commercial/industrial users were able to negotiate lower rates. Enron, on the other hand, made a BOATLOAD of money from the scheme, manipulating the grid, causing market rates to sky-rocket. The fox was guarding the henhouse, and getting plenty fat from it.
Fast forward to 2000, due to "gaming" of the power grid by private marketers and a record heat wave, rates went through the sky, while large segments of the state experienced blackouts. In 2001, the new governor Grey Davis (D) started the year with a state of emergency (which stayed in effect for nearly 4 years), and a new round of rolling blackouts and skyrocketing rates hit during the surmmer, while the state's largest incumbent electric utility, Pacific Gas & Electric, ended up in bankruptcy.
Finally, the game was over - the state was forced to buy out the numerous contracts for huge sums of money. In the end, rates were jacked up for everybody (much more than they were paying before the deregulation experiment) and Grey Davis got booted out for a perceived "lack of response" during the crisis.
California Energy Crisis
Think something like this won't happen in the Sunshine State? Be honest. El Diablo just got himself another big fat contract.
Full Sentinel Article