“We're hoping the candidates forget what they said during the campaign,” said Sam Miller, executive vice president of the Florida Insurance Council. “A lot of things that were raised in the campaign we hope never see the light of day.” But that's no sure bet.

Tackling the First Crisis

Fresh off an easy election-night victory over Democrat rival Jim Davis, Governor-Elect Charlie Crist declared that “mission one” for his administration is tackling Florida's homeowners' insurance crisis. He has seemingly only hardened his resolve to bring relief to frustrated property owners. Crist offered few specifics during the campaign about how he would deal with the property insurance issues, and the proposals he did make did not sit well with the industry.

Crist's most publicized strategy is to force insurance companies offering auto insurance in Florida to also offer property insurance if they do so in other states. He would eliminate Florida-only subsidiaries of national insurance companies because he said that structure doesn't allow the companies to spread risk nationwide, which contributes to higher rates in Florida.

What About the Downside?

Crist wants to make it easier for insurers to tap into a state catastrophe fund. That's the component of his insurance plan that stands a good chance of gaining industry support, because it offers reinsurance to private insurers to help them pay hurricane claims. The concept amounts to lowering the damage amount insurers would have to sustain in order to tap into the catastrophe fund. The downside of the proposal is that giving insurers easier access to the fund means Floridians would have to pay sooner to bail it out, should it run a deficit.

Crist said he expects his plan will lower rates in less than two years. He is confident he can convince the legislature to enact his ideas either in the December special session or in the spring session.

Both the Florida Insurance Council and the Florida Association of Insurance Agents have strong reservations about several of Crist's stated positions. They worry the efforts could backfire, causing more insurers to desert Florida and hurt the state's ability to attract other insurers.

Crist is certainly a familiar face in Tallahassee. He has spent more than 12 years as state attorney general, state education commissioner, and state senator in the capital. But he has little history on insurance issues. That uncertainty is more than unnerving to the industry.

“We really do not know what to expect and what a difference it will make having Charlie Crist in office,” said Scott Johnson, a spokesman for FAIA.

Surprises, Uncertainty in the Future

“Perhaps the biggest surprise of the election season was the relatively unknown Alex Sink defeating Republican Tom Lee for chief financial officer. Sink, a bank president, also took many shots at the insurance industry during her campaign. Sink and Crist will have to agree to make any change on the appointment of the state insurance commissioner.

“There's nearly no way of knowing who they will pick at this time,” said William Stander, Property Casualty Insurers Association of America regional manager for Florida. “What it does spell is uncertainty.”

While Sink enjoyed a great deal of support from the insurance industry, Stander said some of Crist's proposals for dealing with Florida's hurricane-battered property insurance market were “not necessarily in line with what we'd like to see.” Sink retired from Bank of America in 2000 and has been a director of several statewide civic organizations. A big reason why Sink won is because she wasn't previously in Tallahassee and could not be tied to the insurance crisis and state leaders' inability to solve it. Standler said Crist's proposal to force auto insurers to write homeowners' policies is “probably unconstitutional.” He said the industry would wait to oppose Crist's policies until he formally proposes them.

Bracing for Change

As the industry gets ready for a new governor and CFO, it is already bracing for a special legislative session expected to start Dec. 4. A panel headed by Lt. Governor Toni Jennings was expected to release its recommendations in late November. That will provide an outline for what the legislature will address in its special session.

FAIA's Johnson is cautious about what to expect. One proposal could require insurance agents to tell policyholders their commission level. “Premium transparency makes a good sound bite but all it does is increase costs,” he said. He added that insurers would face higher administrative costs trying to figure out how much they pay agents and that won't lower costs for anyone. “It would be a mess,” he said.

Johnson also lambasted the Crist plan to mandate companies to write homeowners' policies. “Auto companies don't want to subsidize other businesses that have coastal exposure to hurricanes,” he said. “We're against anything that will increase premiums.”

On the Horizon

The FAIA is also closely eyeing a proposal by Jennings' committee to cut commissions to agents selling Citizens Property Insurance Corp. policies. FIC's Miller said the end of the Bush era in Tallahassee spells uncertainty for the insurance industry.

“Bush was very active on insurance issues and played an active role,” he said. He said Sink's banking background will help her get up to speed on insurance issues and he hopes the governor will quickly surround himself with experts on the issue.

Miller said the industry knows it's under a microscope from politicians and the electorate because of surging costs. “Insurance costs were the number one issue this year because high rates are on everyone's mind,” he said. Candidates in all state races had to talk about the issue and that meant a lot of ideas were floated. “We hope the candidates forget a lot of what they said during the campaign,” Miller said.

A Mason-Dixon Florida Poll conducted and released in early November shows insurance leads the list of issues causing voters the most consternation, surpassing education and even taxes. Nearly one-in-three Floridians listed property insurance as the most important issue in the governor's race.

But after all the hubbub of the elections, the insurance crisis is still the same as it was before Election Day.

“I don't know that things will be dramatically different, but we can't know what's in store either way.” Miller said.