In the wake of State Farm Florida's announcement of its plan to withdraw its property insurance business from Florida and Insurance Commissioner Kevin McCarty's Order (issued on Feb. 13) conditionally approving that withdrawal, the state's insurance market and regulators face important issues that will most likely be addressed in the 2009 Florida legislative session, which begins this month. How the departure of Florida's largest private homeowner's carrier might impact other companies and Florida insureds are of concern to the public and policymakers.

Many observers want to see State Farm stay in Florida because of its respected name, size, and longtime importance to the state's insurance base. On the other hand, many others agree it may not be feasible or appropriate from a rate and exposure standpoint for any company to have as much Florida business exposure as State Farm presently does.

With Gov. Charlie Crist saying "good riddance" to State Farm, one can presume he has been advised that Florida has enough private market capacity to absorb the additional 1.2 million policies that would become available with the carrier's retreat. In fact, a number of insurers have expressed to state regulators and legislators that they are prepared and willing to take on these State Farm risks.