Bankers Plan Summit Next Month On Insurance Crisis
Written by Charlotte Libov on August 3, 2006
By Charlotte Libov
A newly formed bankers task force will hold a summit next month to seek solutions to a growing insurance crisis in the state, said Alex Sanchez, president and CEO of the Florida Bankers Association.
The association’s Insurance Task Force will meet Sept. 14 at the Hyatt Hotel in Tampa, he said, "to bring together homebuilders, Realtors, citizens, insurance agents, regulators and government officials to see if we can put our heads together and come up with solutions."
He made his comments this week following the return of state banking representatives from Washington, where they met with the state’s congressional delegation and White House banking and economic advisors.
"We didn’t come back with anything concrete," he said. "We want to identify the problem and work on it. That was one of our mission goals, to make sure everybody knew that we had some storm clouds brewing ahead.
"Our congressional delegation knows this is a hot issue and the crisis is not going to go away. But frankly, there’s no sympathy for someone who lives on the Florida coast from people in states like Kansas."
The crisis arose when some insurance companies left the state and others refused to offer windstorm insurance or charged steeply higher premiums, a situation that has officials worried that businesses will flee the state.
"This is a big issue," Mr. Sanchez said. "I’m hearing from bankers from all over the state. I know our economy is doing well, but this is of top priority because this could really hurt our state.
"I don’t want to be a doomsday person, but this is really, really bad," he said. He said he has heard of companies scouting locations in states that don’t have such problems.
He said he is concerned about homeowners as well. "I sent out an e-mail to my banking members asking about the problems their business clients were having, and I got an e-mail back from a young banker who is just starting her career who said she can’t afford her homeowner’s premium, which went from $2,000 to $6,400. We’re going to lose our best and our brightest."
He cited a northern Florida campground where the insurance premium skyrocketed from $1,000 to $50,000. "They’re selling the land because they just can’t pay that."
In Washington, the bankers pushed for "an actuarially sound" national catastrophe fund. "When we talk to our congressional delegation about this," he said, "we’re preaching to the choir.
"We need to build reserves so we can deal with national crises when they occur all over the country. Florida’s done a good job with our building code since Hurricane Andrew. We’ve done some mitigation here, and that should help our congressional representatives when they are dealing with other states. We’re not looking for a handout," he said.
The 15-member delegation to Washington included local bankers José Valdés-Fauli, president and CEO of Beach Bank; and Israel Velasco, South Florida regional executive for Banco Popular. They were part of the group headed by association chairwoman Gwynn Cochran Viorstek and chairman-elect Rick Lee.Details: (850) 224 2265.