t’s now up to the Florida House of Representatives to adopt last-minute changes to a controversial bill that would set up not one but two clearinghouses for Citizens Property Insurance commercial policies.
The state Senate Wednesday night approved Senate Bill 1028, pushed by state Sen. Joe Gruters, by a vote of 33-1, despite Gruters sidestepping or failing to answer almost every question about the revised version.
When Sen. Carlos Guillermo Smith, D-Orlando, asked Gruters if the amended bill has a cap on fees that a clearinghouse administrator could charge, Gruters said, “Yes—15%.”
But that 15% in the bill refers only to the difference in premium between a Citizens policy and a takeout insurer’s projected premiums, not fees charged by a brokerage that may be put in charge of the clearinghouses. A number of Florida insurance agents and brokers have worried that the program’s manager could charge large fees. Another version of the bill, offered by the state insurance commissioner, would have capped fees at $100 to $200 per policy.
The amended bill does note that the 15% difference would include “the aggregate annual premium, plus all fees, taxes, assessments, surcharges, and any other mandatory charges that a policyholder must pay to maintain coverage for the entirety of the proposed policy period.” But it does not directly address clearinghouse fees for agents and brokers.
When Smith asked why a vendor-run clearinghouse is needed and why Citizens can’t manage a takeout system itself, Gruters said only that “we don’t want to burden the taxpayers.” But Florida Commissioner Mike Yaworsky has said that even a privately administered clearinghouse could cost as much as $40 million – and that would not come from taxpayers.