Contact FreedomWorks

400 North Capitol Street, NW
Suite 765
Washington, DC 20001

  • Toll Free 1.888.564.6273
  • Local 202.783.3870

Blog

    Florida Braces for Insurance Meltdown

    09/07/2008

    As Florida gets ready for Hurricane Ike - FreedomWorks' chief economist, Dr. Wayne Brough had this piece published in the Orlando Sentinel last week.

    In it, Dr. Brough points out how Gov. Crist's meddling in the insurance market has forced the industry out of the state, leaving homeowners and taxpayers exposed to enormous amounts of risk.

    Friday, Time magazine also wondered "Could Florida Survive the Big One" as they examined the insurance problems facing the state.

    ...it's still dangerously exposed — not only to the elements, but to financial ruin. It's got the nation's most dysfunctional property insurance market, a byproduct of life in harm's way. Fitch's ratings agency concluded in March that if a big storm hits Florida, "the fragile market could effectively collapse."

    The article goes on to point out how not only will Florida taxpayers be on the hook for their neighbor's property losses when another big one hits, but Florida is hoping the nation will chip in as well for those who find their beachfront retirement house is suddenly a boathouse.

    That's why Crist and just about every other Florida politician is pushing for a national catastrophe insurance fund, which would shift some of that risk to federal taxpayers. But the idea is not so popular with other states, for the obvious reason that other states don't have as much risk. Florida has spent the last 80 years ignoring its vulnerability, developing its floodplains and shorelines, selling the dream of the Sunshine State to northerners and foreigners.

    Still, Time's piece ends poignantly, and we would agree:

    But the day of reckoning will come.

    Hopefully it won't come Tuesday.