Insurers gained while Florida lost

BY MATT REED

FLORIDA TODAY



You might think, with thousands of blue tarps still covering your neighbors' roofs, that Florida insurers are buckling under record losses.

You might have assumed -- if you've dickered with an adjuster or fretted over your windstorm deductible -- that property insurers must double their rates to survive.

Or that insurers will drop policies and leave the state. Or that a state fund must cover a bigger share of disaster claims for companies to remain solvent.

But none of that is true.



In fact, Florida's major property insurers managed to earn profits during the period that included hurricanes Charley, Frances, Ivan and Jeanne, securities filings and earnings reports show. Even as the industry announced record losses and called for higher rates, company executives told analysts they were strong enough to pay claims and still make money. And that's before any changes.



Now, as the Florida Legislature prepares for a special session on hurricane relief, a FLORIDA TODAY/Gannett Co. examination of the insurance industry and its millions of policyholders has found:

• Of the dozen insurers consistently ranked among the biggest in Florida, all seven publicly traded companies reported profits in the third quarter, records show. Those earnings reflect all of their estimated catastrophe losses, including those to be paid in the fourth quarter.

• Some major insurers have formed Florida subsidiaries used to better track premiums and losses -- and to lobby the state for rate increases. On that level, the picture looks bleak. But the Florida companies pay only a fraction of their hurricane claims. Much, if not most, money comes through parent companies, which have collected hundreds of millions of dollars in dividends and other payments from Florida for years.

• More than one-third of all Floridians suffered hurricane damage to homes and businesses this year, a statewide poll for FLORIDA TODAY/Gannett Co. found. And they will pay just as much for damage out of their pockets: roughly $17 billion, officials say. Meanwhile, four out of five people who filed claims say they're concerned their insurance companies will drop their policies. More than half haven't received settlement checks, the poll found.

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