State CAN Suspend Allstate From Writing New Policies - Florida Courts Say

As some of you may remember, a couple of months ago I reported that Allstate had refused to produce documentation that the State of Florida had requested. Therefore, the state told Allstate that it could no longer write any new insurance policies in Florida, including auto and life insurance coverage. Allstate appealed and a court temporarily stopped the state's move.

Now the courts have told the state Office of Insurance Regulation that it CAN prohibit Allstate and its subsidiaries in Florida from writing new policies until it produces the documents that the state has demanded of it. Allstate says it is doing all it can (yeah, right). If the company produces the requested documents, they can return to their business of issuing new policies.

Since insurance reform was legislated over a year ago, many companies have been either foot dragging, looking for loop-holes in the law, or just continuing to request huge rate increases. To many of my customers and me, it appears that the reform laws have had little effect on protecting the consumers here in Florida. Perhaps this latest round will make a few of them toe-the-line, at least a bit.

The suspension applies to Allstate Floridian Insurance Co., Allstate Indemnity Co., Allstate Property & Casualty Insurance Co., Allstate Insurance Co., Allstate Floridian Indemnity Co., Allstate Fire and Casualty Insurance Co., Encompass Insurance Co. of America Encompass Indemnity Co., Encompass Floridian Insurance Co., and Encompass Floridian Indemnity Co.

In a related topic, some state legislators are talking of taking $250,000,000 from Citizen's reserve fund to help encourage new insurance companies to start up in the state. This is a loan, not a permanent withdrawl from Citizen's coffers. At this point it is too soon to say if this proposed legislation will make its way into law, but we will keep a watch on it to see how it fares. More companies, and therefore more competition and consumer choices, might not be bad things for us to have here.

For more information or questions about this topic please call me at: 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com

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