Some lawmakers are inclined to give homeowners covered by the state-run insurer another break on rate increases next year.
But Alex Sink, Florida's chief financial officer, said it's ''not wise to extend the rate freeze'' on Citizens Property Insurance any further. She would like to see Citizens have rates in place that give it a greater chance to amass enough reserves to pay claims in the future.
Such so-called actuarially sound rates would reduce the need for surcharges on all insurance policyholders in Florida if Citizens has more ample reserves.
''The longer we go without reviewing their pricing, the bigger that potential deficit could be,'' said Sink.
But she isn't advocating a huge hike next year.
Like Sen. Ken Pruitt, the Senate president, Sink favors a gradual increase in Citizens rates to make it easier on its policyholders who already pay some of the highest insurance rates in the state.
Key senators and representatives, including Sens. Al Lawson, D-Tallahassee, and J.D. Alexander, R-Winter Haven, and Rep. Don Brown, R-Defuniak Springs, have argued for several years now that many homeowners living in central and northern sections of the state are subsidizing lower rates for Citizens policyholders, especially those in coastal areas.
Sink noted that a study done for the Department of Financial Services showed that some homeowners paid rates that could have been 20 percent to 50 percent higher -- a form of subsidy some lawmakers would say -- because of the current rate structure for Citizens.
Lawson has voted twice against a far-reaching insurance bill that proposes extending the current Citizens rate freeze for another year.
Indeed, Citizens, which is the largest insurer of houses, condos and mobile homes in the state, has nearly half of its exposure in South Florida.
That tally includes more than 260,000 windstorm policies in Broward, Miami-Dade, Monroe and Palm Beach counties.
A severe storm could deplete Citizens reserves and require a surcharge to cover a deficit. That's exactly what happened after the storms of 2004 and 2005. Citizens had passed along two surcharges.
This Senate bill would also allow Citizens to continue to insure homes valued at more than $1 million.
Sink said she believes these homes can find coverage in the private or surplus lines insurance market, leaving Citizens for homeowners who have no other resources for coverage.
