Politics
Emergency insurance assessment for Florida policy holders shelved 2 years early
‘Ending this assessment two years early is yet another indicator that the insurance market has stabilized.’
An emergency assessment initiated more than two years ago to pay for insurance bonds is coming to an early end.
The Florida Insurance Guaranty Association voted this month to eliminate the 1% emergency assessment on Florida homeowner and business property and casualty policies two years earlier than expected.
The assessment was initiated on Oct. 1, 2023, to pay for bonds issued through the Florida Insurance Assistance Interlocal Agency to help cover unearned premium refunds through claims related to storm-related property insurance filings.
Those assessments covered 10 homeowner insurance companies that went insolvent.
The Association’s decision to end the assessment is expected to save about $650 million that would have been racked up and paid by Florida policyholders through Sept. 30, 2028. There will still be a charged assessment of 1% through Sept. 30 this year, but it will end Oct. 1.
Florida Chief Financial Officer Blaise Ingoglia said the end of the emergency assessment is a positive sign for the state.
“It is always a good day when we can announce that Florida families will see a reduction in their insurance premiums, and this announcement is a huge win for Florida’s policyholders. When an insurance company goes insolvent, it not only hurts its policyholders, but it also hurts all policyholders in the state of Florida,” Ingoglia said.
Insurance Commissioner Mike Yaworsky said the easing of the assessments is largely due to insurance industry overhauls initiated by the state in the past few years.
“The historic reforms by the Florida Legislature in 2022 continue to reverberate through the market, and ending this assessment two years early is yet another indicator that the insurance market has stabilized and is producing savings for consumers,” Yaworsky said.
The Florida Insurance Guaranty Association was established in 1970 by the Legislature to act as a safety net for Florida insurance policyholders who file claims within a month of an insurer that becomes insolvent. The Interlocal Agency of that Association, founded in 2006, has a special purpose of issuing tax-exempt bonds to cover claims of insolvent companies arising from hurricane-related losses.
