They Say, Hearsay
First, politicians let Citizens Property Insurance and the Hurricane Catastrophe Fund grow. Now, there is all this talk about shrinking both of them, and I hear that will make my insurance bill rise. Where's this sense of urgency coming from? Seems like we've got people crying wolf for no good reason.

We Say
There is good luck, and there's dumb luck. We've had both over these 6 consecutive hurricane-free years. Today, however, calls to shrink Florida's state-run property insurance mechanisms are coming from intelligent people who think the way you make your own luck is to plan for the time it runs out—whenever that is.

Running on luck is not what the COO of the Florida Hurricane Catastrophe Fund (Cat Fund) wants to do. Jack Nicholson has been saying, in essence, that if and when a major hurricane strikes, all the good fortune in the world (aka capital) will bring in no more than $7 billion in bonds to meet the Cat Fund's current obligation of $18.4 billion. By year-end, lucky Florida's Cat Fund will have $8.4 billion in cash, but there's no way today's world financial markets would find investors willing to buy $11 billion in bonds to close the gap. Marketplace realities say the best we could hope for is $7 billion—tops.