Insurance company

The man behind most of Florida’s insurance company ratings paints a bleak picture if the crisis isn’t resolved

TAMPA, Fla. (WFLA) — Homeowners across the state of Florida are seeking relief from soaring property insurance rates — as are those in the industry.

Joseph Petrelli, president of Demotech, Inc., controls the financial rating of 60% of Florida insurance companies. He is now urging lawmakers to hold not one, but two special sessions to deal with skyrocketing property insurance premiums in Florida.

For 26 years, Petrelli has been evaluating the financial health of our state’s insurance companies. It currently assesses 42 Florida companies.

He says a group of insurers are on the brink of insolvency due to excessive litigation and ultimately homeowners will pay the price.

“We are in constant contact with these companies,” Petrelli said. “We are particularly concerned about eight or 10 companies, maybe more.”

Investigative journalist Mahsa Saeidi asked if they could be downgraded and how many policies were affected.

“If we’re looking at — say, eight companies — we’re looking at maybe 200,000 policies to, incredibly, close to a million policies,” Petrelli said. “People will lose their jobs, agents will no longer have a market, consumers will be scrambling. It’s something we take very seriously. »

So what would happen to the already high rates that Floridians face?

“At this point the sky is the limit,” explained Petrelli. “Complaint frequency is ultimately what drives the bus and until complaint frequency is brought under control there will be rate increases as far as you can see.”

Petrelli says he was hoping there would actually be two special sessions.

“One to put in place an immediate remedy and the other a longer-term remedy,” Petrelli said. “If someone doesn’t want to have a special session, what data do they consult? This is not a box that can be sent back on the road for six more months.

Forecasters expect another above-average hurricane season. Petrelli says if there is a storm, there will be hundreds of thousands of claims. Every claim becomes an opportunity for litigation, and it could crush the Florida market.

“Without reforms, an above-average storm season will only create hundreds of thousands of claims that will become litigation opportunities, it’s going to be a nightmare,” he said.

Do you have any advice or story idea for Investigator Mahsa Saeidi? Email him at [email protected]

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