Client News
Sarasota Herald Tribune: Bills bad for insurance
Wednesday, September 25, 2013
By Sam Miller
As residents of the most hurricane-prone state in the world, Floridians need and deserve a stable and healthy insurance market to ensure a swift and easy recovery when the next storm impacts our state. Unfortunately, as Citizens Property Insurance Corp. works to return to its original mission of “insurer of last resort,” and state lawmakers implement changes to reinvigorate the private insurance market, a federal issue jeopardizes our state’s forward progress.
Reps. Richard Neal, D-Mass., and Bill Pascrell, D-N.J., and Sen. Robert Menendez, D-N.J., have introduced legislation that will deny tax deductions for certain reinsurance premiums paid to foreign-based affiliates by domestic insurers. H.R. 2054 and S 991, as well as a similar proposal included in President Obama’s 2014 fiscal year budget, would create an anti-competitive tax structure which has the potential to negatively affect Florida.
As Florida’s largest trade association, the Florida Insurance Council appreciates the role that private reinsurance plays in our industry. Today, global insurance companies provide nearly two-thirds of all reinsurance throughout the country, including a considerable share of the property insurance in Florida. The private reinsurance products available today help spread Florida’s risk globally, allowing our member companies the ability to keep insurance premiums affordable for homeowners and business owners.
To discourage reinsurance companies from doing business in Florida by enacting either of these proposals is imprudent. In the midst of hurricane season, the FIC believes that Congress should reject any proposal that threatens to make insurance availability scarcer and costlier in Florida.