081-1999 LTC
CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
http:\\ci.miami-beach.fl.us
L.T.C. No. 81-1999
LETTER TO COMMISSION
March 30, 1999
TO: Mayor Neisen O. Kasdin and
Members of the City Commission
FROM: Sergio Rodriguez ~:;:;)IL
City Manager
SUBJECT: FLORIDA WINDSTORM UNDERWRITING ASSOCIATION PROPOSED
RATE INCREASE
The Florida Windstorm Underwriting Association (FWUA) has proposed a new rate structure and
corresponding rate increase that would average 119 percent statewide and as much as a 253 percent
increase in Miami-Dade County. The potential impact of this rate increase on Miami Beach
homeowners is significant despite discounts proposed by FWUA for various wind-resistant features.
The FWUA proposal will be submitted to Insurance Commissioner Bill Nelson for approval in April,
and he will have 90 days to decide whether or not to approve the filing. Ifhe denies the filing, it will
go to an independent arbitration panel.
We have discussed this proposed increase with our State Lobbyists who report the following.
Eighteen months ago a FWUA-proposed 60 percent rate increase was rejected by the Insurance
Commissioner, which then went to arbitration and resulted in a one-year 12 percent increase.
Commissioner Nelson has announced his bid for Senator Connie Mack's seat and is unlikely to anger
voters state-wide with a rate increase of this proportion. The lobbyists have informed us that if any
rate increase is approved, a 10 percent increase is more likely. They recommend contacting
Commissioner Nelson to express our concerns about the proposed increase and passing a resolution
opposing the proposal. A letter, reviewed by the lobbyists' insurance specialist, is attached, as is the
proposed resolution that will be presented in the April 14, 1999 Commission agenda. The lobbyists
recommend that the letter be sent at this time rather than waiting for the resolution to be passed or
for the proposal to be filed officially.
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Attachments
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CITY OF
MIAMI
BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH FLORIDA 33139
OFFICE OF THE CITY MANAGER
TELEPHONE: (305) 673-7010
FAX: (305) 673-7782
March 30, 1999
The Honorable Bill Nelson
Commissioner & Treasurer
Department of Insurance
The Capitol
Tallahassee, Florida 32399-0300
Dear Commissioner Nelson:
On behalf of the residents of the City of Miami Beach, Mayor Kasdin and the City
Commission, I am writing to express concerns regarding the requested rate increase submitted to
your department by the Florida Windstorm Underwriting Association. We believe a rate increase
of such magnitude was not adequately supported in the rate filing. Many of the City's residents are
on fixed incomes and would be unable to afford such an exorbitant rate increase without warning.
I urge you to require the FWUA to adequately substantiate their need for rate increases within
our city. This is the only way that you can protect consumers within the City of Miami Beach from
unwarranted and unsubstantiated price increases. Public hearings on this matter should be held in
order to determine the proper rate structure.
My staff stands ready to assist the Department in its assessment of the adequacy of our
building codes, emergency response systems, or any other element of local loss prevention and
mitigation in order to prove the rate increase is not substantiated. I look forward to hearing your
response at your earliest convenience.
Sincerely,
~~
Sergio Rodriguez
City Manager
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RESOLUTION NO.
A RESOLUTION OF THE MAYOR AND CITY COMMISSION
OF THE CITY OF MIAMI BEACH, FLORIDA, OPPOSING
THE FLORIDA WINDSTORM UNDERWRITING
ASSOCIATION'S PROPOSED WINDSTORM INSURANCE
RATE STRUCTURE AND RATE INCREASE.
WHEREAS, the Florida Windstorm Underwriting Association has proposed a new rate
structure that would significantly increase rates paid by residents of the City of Miami Beach; and
WHEREAS, the proposed rate structure does not adequately consider the City of Miami
Beach's building codes, emergency response systems and other elements oflocalloss prevention and
mitigation; and
WHEREAS, affordable insurance premiums, fairly based on the risk factors and loss
prevention efforts, directly relate to the economic vitality of Miami Beach;
NOW, THEREFORE, BE IT nUL Y RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Miami Beach City
Commission opposes the Florida Windstorm Underwriting Association's proposed new windstorm
insurance rate structure and proposed rate increase.
PASSED and ADOPTED this _ day of
,1999.
ATTEST:
MAYOR
CITY CLERK
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