A bill moving steadily through the Florida Legislature has suddenly ignited a storm of contro
versy, with some insurance agents and brokers worried it could benefit one large brokerage while costing others fees and flexibility on takeouts of Citizens Property Insurance commercial policies.
“The main question I have is, ‘What is the problem that this is trying to solve?'” said Chris Siegel, Florida vice president at Burns & Wilcox, a surplus lines brokerage. “We’re already doing all this without a surplus lines clearinghouse.”
Siegel was talking about Florida Senate Bill 1028, sponsored by state Sen. Joe Gruters, the chairman of the Senate Banking and Insurance Committee. The bill would r
equire Citizens to set up a clearinghouse for brokers and agents to use to place commercial property coverage with lightly regulated excess and surplus lines carriers.
Gruters’ committee approved the bill 10-0 in January, followed by the Appropriations Committee on Agriculture, Environment, and General Government on Feb. 6. The measure has one more committee stop in the Senate, as does a companion bill in the House.
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It may sound innocuous on the surface: A framework for a mechanism much like the clearinghouse used to help move personal lines policies out of Citizens, Florida’s once-bloated insurer of last resort. But Florida Insurance Commissioner Michael Yaworsky voiced deep concerns about the bill at the committee hearing last week. He said a commercial clearinghouse could cost as much as $40 million to set up—a sporty price tag for relatively few commercial policies.
“Why spend that much money for just 3,000 policies—at the most?” said Dulce Suarez-Resnick, a commercial agent and vice president at Acentria Insurance in Miami.
And industry insiders familiar with Gruters’ bill have argued that it appears to be written to favor one company: Ryan Turner Specialty, also known as RT, part of one of the largest wholesale brokerages in the country. An explanatory sheet circulated in Tallahassee, apparently produced by Ryan and marked “confidential,” shows the firm already has taken steps to build what would be known as “The Florida Risk Exchange—An AI-Enabled Ryan Specialty Enterprise.”