“This is like the iPhone for insurance in Florida,” said board member John Rollins, before the vote. “It’s going to really transform everything about the way a consumer thinks about shopping for home insurance.”
But state Rep. Frank Artiles, R-Miami, a frequent critic of Citizens, said that while the clearinghouse concept offers some consumer protections, it is designed to benefit insurers and insurance agents over customers.
“My take on the clearinghouse is that it was built to protect agents,” he said, referring to the agents who sell auto, life and personal-property coverage for national companies but do not sell homeowners insurance in Florida. “Your property gets put into the clearinghouse, and it gets shopped around for anybody who is writing insurance so they can keep their clients.”
Under a compromise reached with the Miami-Dade delegation, Citizens policyholders who are forced to take a policy from a private carrier in the clearinghouse will see their premium increases capped at 10 percent for three years and have the option to return to Citizens.
Artiles advises Citizens customers to do their homework.
“Ask for a copy of the policy, and ask for the differences between it and your Citizens policy,” he said.
For example, private companies have the right to repair damage to a home instead of paying for replacement coverage. Hidden in some policies, however, is a statement that if they hire a third-party contractor to do the work, the carrier is not responsible for the work, Artiles said.
“I have a problem with that,” he said. “If you want the right to repair, then you have to take full responsibility for the subcontractor or vendor who works for you.”
While the clearinghouse will not be available for consumers to comparison-shop, it will be available for agents. Meanwhile, the Office of Insurance Regulation has a website that offers information about each takeout company at www.floir.com/Sections/PandC/TakeoutCompanies.aspx
Artiles considers the website difficult to navigate and understand. He advises: “If you have to make a decision with your eyes closed on a takeout company, stay with Citizens.”