Insurance Regulation Shifts Loom in Georgia and Florida
Property-casualty insurance carriers in Georgia and Florida are preparing for potential regulatory shifts following recent election results. In Georgia, Keisha Sean Waites, a former state legislator and Atlanta City Council member, defeated incumbent Insurance Commissioner John King. Waites secured 54% of the vote compared to King’s 46%.
Waites has outlined a policy agenda that includes freezing certain auto and homeowners’ insurance rates, accelerating claims payments, and implementing new measures to increase insurer accountability. Additionally, she has proposed banning the use of credit scores and ZIP codes when determining insurance premiums. King, who was appointed in 2019 and elected to a full term in 2022, had previously overseen legislation that prohibited use-and-file rate increases for auto insurers. It remains uncertain if the October fatality involving a rider at a Six Flags amusement park, which falls under the commissioner's inspection oversight, influenced voter sentiment.
In Florida, U.S. Rep. Byron Donalds won the gubernatorial race against David Jolly, capturing 50.02% of the vote to Jolly’s 49%. Donalds has proposed introducing a scorecard system to evaluate Florida insurers, specifically focusing on the speed of claims payments. This proposal has generated concern among industry advocates, who note that legitimate delays often occur due to factors like contractor shortages following storms.
Donalds has also advocated for repealing the cash buildup factor within the Florida Hurricane Catastrophe Fund (FHCF). This fee, which adds 25% to premiums for Cat Fund reinsurance coverage, was established after Hurricane Wilma in 2005. While Donalds suggests that removing this fee would lower premiums for property owners, a 2025 paper from the Cat Fund warns that such a move would increase the program's reliance on debt and hinder its ability to pay losses from cash reserves after major hurricane events. Meanwhile, Florida voters also approved Amendment 3, which will reduce property taxes for some homeowners, potentially freeing up funds for insurance coverage.
These election outcomes suggest a period of transition for the insurance sector in both states, with carriers likely facing increased oversight regarding pricing models, claims processing speeds, and state-level reinsurance fund structures.
Why it matters
The shift in leadership in Georgia and Florida introduces new regulatory risks and operational challenges for insurers, particularly regarding rate-setting flexibility and claims management oversight.
FAQ
What specific changes has Keisha Sean Waites proposed for Georgia's insurance market?
Waites has pledged to freeze certain auto and homeowners' rates, speed up claims payments, hold insurers accountable, and ban the use of ZIP codes and credit scores in setting premiums.
Why are some industry advocates concerned about Byron Donalds' proposal for an insurer scorecard?
Advocates worry that a scorecard focusing on claim payment speed ignores legitimate delays, such as the difficulty of finding repair contractors after storms.
What is the function of the cash buildup factor in the Florida Hurricane Catastrophe Fund?
According to the Cat Fund, the buildup factor helps the program avoid borrowing money, issuing bonds, or levying emergency assessments by allowing it to pay losses out of its cash balance.
Source: Insurance Journal. See the original source for full details.
Scan with your phone
Scan with your phone