© 2024 Allbritton Journalism Institute

How Florida’s Insurance Crisis Is Becoming a Political Liability for Republicans

“I think whoever’s running for governor next in Florida, if they run on that platform, will definitely have an easy one in Florida,” Republican Rep. Anna Paulina Luna told NOTUS.

A skeleton in sunglasses sits beside a sign reading, "Just waiting for the insurance check."
Florida homeowners could be on the hook to pay out state-backed property insurer Citizens’ claims if there is a major storm. Rebecca Blackwell/AP

Senate Democrats warn that Florida’s state-backed property insurer of last resort is barreling toward a federal bailout. The insurer, Citizens, says the Senate is causing unnecessary panic. Florida Republicans in Congress are imploring their state-level counterparts to act. And Florida’s Republican-led state legislature says it already has.

Meanwhile, Gov. Ron DeSantis is blaming the weather and inflation.

The political finger-pointing surrounding Florida’s property insurance crisis underscores just how significant an issue it is in the 2024 elections — and how big a liability it could be for Republicans. Florida homeowners have seen insurance premiums skyrocket in recent years as private insurers left the market. And they could be on the hook to pay out Citizens’ claims if there is a major storm.

Florida Democrats are seeing the cracks and planning targeted messaging around property insurance this election cycle, emphasizing that Republicans have controlled the state as rates have climbed. One state-level Democratic consultant told NOTUS that property insurance and abortion would be Republicans’ “kryptonite” this year.

Democratic Senate Budget Committee Chair Sheldon Whitehouse sent a letter to Citizens last week saying it has “failed to cooperate” with a committee investigation launched in November into its solvency. Citizens has “done nothing to assuage the Committee’s concerns about possible future requests for a federal bailout,” Whitehouse wrote.

Republicans at all levels are acknowledging the problems — and the political risks they carry.

“It is one of the top things people have called our office for that are concerned,” Rep. Aaron Bean said. “When I’m talking on the circuit out there, people are really concerned about it. They have seen their premiums skyrocket.”

Rep. Anna Paulina Luna told NOTUS, “I think whoever’s running for governor next in Florida, if they run on that platform, will definitely have an easy one in Florida.”

But no one can agree on who is at fault. DeSantis pointed blame for the high insurance rates, in part, on the weather: “We’ve had three major hurricanes from 2017 to the present.” He also took a swipe at inflation, saying, “It’s much more expensive to do a roof today than it was four, five years ago; that’s just the reality.” But he also insisted recent attempts to lure back private insurers are working to get Floridians off the state-backed insurer. “I think it’s more attractive today to offer policies than it was over the last 20 years.”

Citizens says Congress needs to calm down. In a December letter, Citizens CEO Tim Cerio said the Senate’s investigation “can foreseeably cause needless and completely misplaced panic in a market that is already well on the way to recovery because of actions taken by Governor DeSantis and our state’s legislative leadership.”

Florida Republicans in Washington aren’t buying it.

“They swung completely in … the wrong direction,” Rep. Greg Steube said of the Republican-supermajority state legislature’s attempts at fixing the property insurance market in recent years. “DeSantis took a huge swing towards insurers and against consumers,” describing Florida’s property insurance at “crisis levels.”

Sen. Rick Scott, who served as Florida governor from 2011 to 2019, doesn’t give DeSantis much credit. “When I was governor, we fully funded Citizens, we made sure that it was actuarially sound,” he told NOTUS.

“I think it should be led by the governor and also, too, the state legislature — which they could actually fix it,” Luna said. “I think that they just don’t want to address that right now, so I encourage my fellow colleagues to solve that problem.”In a written statement provided to NOTUS, Citizens flagged provisions in Florida law to “levy surcharges on its policyholders and assessments on non-Citizens policyholders to eliminate any deficit.” It’s not a popular fallback plan among Florida residents, but according to Citizens, it ensures they won’t need a federal bailout.

The insurer noted it has seen a decrease in the number of policyholders in recent months but acknowledged their books don’t quite add up. “Rates are currently actuarially unsound,” according to the insurer, because of caps on how much premiums can increase each year set by state lawmakers.

DeSantis, too, told CNBC that Citizens “is not solvent, and we can’t have millions of people on that because if a storm hits, it’s going to create problems for the state.” The comment prompted Whitehouse’s latest letter to Citizens.

While Citizens is dismissing federal bailout concerns, Florida Democrats are taking the Senate investigation seriously and are ready to use it politically. After it was announced in November, Florida Democratic Chair Nikki Fried wrote on X: “When the federal government is having to come in and say your sh*t is messed up, your sh*t is messed up. Florida’s property insurance crisis has reached a critical tipping point.”

Claire Heddles is a NOTUS reporter and an Allbritton Journalism Institute fellow.