Insurance rating is a black box in many ways. There are so many layers of data that go into it, in fact, that rating may be more like a matryoshka doll made up of nesting analytical processes.
When individuals in Miami purchase a home, whether it is their first or one in a long string of ownership, a requirement of most closings is homeowners’ insurance. A homeowner will then consistently pay the monthly or yearly premium required under the policy.
Since so many aspects of life are unpredictable, Florida residents frequently take precautions by maintaining a homeowners insurance policy. When storms inflict damage or someone is injured on a person’s property, insurers can provide much-needed support for homeowners.
We are finishing up our discussion of anti-concurrent causation clauses, but we would like to reserve the right to revisit the issue. A state that was hit hard by Superstorm Sandy is considering legislation that would address, among other things, anti-concurrent causation clauses in homeowners insurance policies. The insurance industry calls the proposal “misguided, if well-intentioned.”
If things happen in threes, and your homeowners insurance policy has an anti-concurrent causation clause in it, you had better hope all three of those things are covered. If not, your insurer will deny the claim. Homeowners hit by Superstorm Sandy learned this lesson the hard way, and state legislatures and regulators are looking into how to rein in insurers’ vigorous enforcement of ACC clauses.
We are continuing our discussion of anti-concurrent causation clauses in homeowners insurance policies. ACC clauses have garnered attention in the past few months as states less well-versed in insurance than Florida dealt with the aftermath of Superstorm Sandy. Homeowners were surprised to learn that their insurance policies included a kind of all-or-nothing coverage provision.
With hurricane season looming over Florida homeowners, it may be time for us to learn something from other states with less major storm experience. When Superstorm Sandy hit Mid-Atlantic and New England states last year, homeowners and commercial property owners learned the hard way that anti-concurrent causation clauses in insurance policies are valid and enforceable. At least one of those states has passed a law requiring insurers to explain the ACC clause in a separate notice to each and every new and renewing policyholder.
Florida Rep. Mario Diaz-Balart believes the country should catch up with his home state when it comes to building codes. The congressman is the chief House sponsor of HR 1878, the Safe Building Code Incentive Act of 2013. The bill was also introduced in 2007, 2009 and 2011. Proponents hope that the fourth time is the charm.
Florida Gov. Rick Scott apparently had no reaction to the Citizens reform bill that landed on his desk last week. His office said only that he was “reviewing the proposal.” There was no hint that he was either disappointed or relieved that the rating methodology changes did not make it into the final bill. Legislators and homeowners alike will just have to wait to see what happens.
The Florida Legislature has sent a less ambitious insurance bill to Gov. Rick Scott than some lawmakers had hoped. The bill does not offer a complete overhaul of Citizens Property Insurance Corp.; rather, it represents a more incremental approach to reform that seemed to go over better with legislators concerned, in particular, about raising rates.
