Gov. Rick Scott signed into law today a sweeping property insurance measure (SB 408) hailed by the insurance industry but denounced by consumer groups.

Critics say the new law, which goes into effect immediately, will allow insurance companies to raise rates up to 15 percent and make it harder for Floridians to collect on claims. Proponents contend the law will draw new insurers to the state and increase competition.

“A healthy, stable and competitive private insurance market is critical to the success of Florida, given the hazards we face,” Scott, whose staff helped craft the bill, said in a statement. “I commend the Florida Legislature, especially Senator Richter and Representative Wood, for bringing this important legislation forward.”

The new law undoes many of the changes approved by lawmakers and Gov. Charlie Crist in the wake of the catastrophic 2004 and 2005 hurricane seasons.

Among other things, the new law:

- Shrinks from five years to three years the time homeowners have to file claims for hurricane damages;
- Lets insurers make homeowners to pay for repairs before getting reimbursed;
- Permit insurers to raise policyholders’ rates without prior approval from regulators;

Scott’s signature prompted a flurry of accolades from the insurance industry and business groups and a dour statement from Sen. Mike Fasano, who urged Scott to veto the measure.

“For an administration which vowed not to support new taxes or fees, this bill virtually guarantees a 15% premium ‘reinsurance’ increase for Florida policy holders. This is a backdoor tax and fee increase that will hurt most homeowners with a mortgage, consumers and small business owners at a time with very high foreclosure and unemployment rates, all during a fragile economic recovery,” Fasano, R-New Port Richey, said in a statement.

But supporters insist the new law will open up Florida’s insurance market.

“Despite what the critics say, signing this bill into law is the first step toward stabilizing Florida’s property insurance market. It will increase competition by attracting insurance companies that currently do not write property insurance policies in Florida,” said Mark Wilson, president Florida Chamber of Commerce.

Read some of the other blurbs after the jump.

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Republican Gov. Charlie Crist just said he would veto any bill that favors the property insurance industry.

That seems to spell certain doom for the bill that would let insurers raise rates without prior approval from the state.

Gov. Charlie Crist performed as the Sunshine State’s chief pitch-man, blowing off Florida’s historic population loss and touting the fine weather in a CNBC interview this morning.

Florida saw a drop of 58,000 residents last year, the first population decrease since military residents left the state after World War II.

“It’s not that big a deal, to be honest with you,” Crist shrugged off the decline on CNBC’s “Squawk Box” show today.

The governor then launched into a Sunshine State sales pitch, touting declines in property taxes and property insurance rates and the weather.

“And it’s Florida. It’s a beautiful place. It’s a gorgeous day today down here in South Florida. You just can’t beat the Sunshine State,” said Crist, who is in Miami. Florida I really think is on the rise and it’s a great deal for an awful lot of people, too.”

Although Florida’s unemployment rate is nearly 11 percent, Crist was upbeat about the job market and pointed to Palm Beach County as a shining example.

Palm Beach County’s unemployment rate was 11.7 percent in July, one percentage point above the state average.

“Even in the Palm Beach County area where Scripps and Torrey Pines and some of these other scientific institutes have located, Max Planck…it’s been great for that area of the state,” Crist said. “We’re very pleased with the direction things are going. We wish they were better, don’t misunderstand me. But we’re not sitting still. We’re on the move. And I continue to be optimistic and encouraged about where we’re going.”

Crist, who drew the wrath of fellow Republicans by urging Congress to pass President Barack Obama’s economic stimulus plan, reversed that position on the health care reforms now being considered in Washington.

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Republican state Rep. Pat Patterson kicked off his campaign Wednesday for state chief financial officer from his hometown of DeLand (pictured below). But to win the office, the 10-year House veteran must first get through Senate President Jeff Atwater, R-North Palm Beach.

One reason to watch Patterson’s campaign is to see who supports him in favor of the sitting Senate president. Not that Atwater necessarily would let a state political race control his chamber’s agenda, but if you’ve got an issue in the legislature (and folks with money do) then its generally best to make friends with the man in charge of half of it.

Another reason to watch Patterson: he’s from Central Florida and right now that seems to be the key to Florida politics: Every statewide office holder right now is from the I-4 corridor (Nelson, Martinez, Crist, Sink, McCollum and Bronson). The last politician not from Central Florida to win a state election was President Barack Obama, a Chicagoan who, it could be argued, still lived closer to the I-4 corridor than Republican nominee John McCain, R-Ariz.

And that geography could play on property insurance issues: Patterson in an interview earlier this summer was quick to point out that 65 percent of Citizens policies are from five counties (including four from South Florida).

Those five counties, he says, pay just 35 percent of the Citizens’ assessment.

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That’s part of the curious headline on a Wall Street Journal editorial this morning that (again) rips Gov. Charlie Crist’s property insurance policies. Crist vetoed a bill last week that would have let State Farm and the state’s largest insurers offer their customers unregulated rates.

What does that have to do with U.S. Rep. Frank? Here’s the one mention of the Massachusetts Democrat:

The Republican legislature tried to reduce those future losses, but Mr. Crist sounded like Barney Frank rolling the dice on Fannie Mae in declaring there’s nothing to worry about.

The U.S. House Financial Services Oversight and Investigations Subcommittee will hold a hearing in West Palm Beach on Thursday at 10 a.m. in the city commission chambers to review the availability and affordability of homeowners insurance in the country.

The subcommittee will examine insurance industry coverage of catastrophic natural disasters, the withdrawal of insurance companies from offering policies in coastal areas, rising homeowners’ insurance premiums and the resulting economic impact on state and local governments, as well as possible solutions to the homeowners’ insurance crisis.

U.S. Rep. Ron Klein, D-Boca Raton, will also participate in the hearing.

From our Eye On The Storm blog:

Gov. Charlie Crist said today a bill to let insurance companies raise property rates outside the control of state regulators “deeply concerns me.”

“I have my concerns about it, to be candid with you,” Crist said. “To not have the office of insurance regulation able to regulate insurance rates anymore deeply concerns me.”

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The Florida Senate this morning approved an average increase of 5 percent for Citizens Property Insurance premiums, setting up a showdown with the House, where a proposal would let rates jump 20 percent.

The Senate bill (SB 1950) was approved 34-2. South Florida Sens. Eleanor Sobel, D-Hollywood, and Rudy Garcia, R-Hialeah, voted against it.

The bill was significantly amended Monday by Sen. Mike Fasano, R-New Port Richey, to cut the cap on rate increases in half. Customers of the state-run insurer have not had a rate increase in three years.

“God bless him,” Gov. Charlie Crist said of Fasano this morning. “Obviously, when you’re in a tough economy, if there is less of an increase, that’s better for the people.”

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In a positive sign for the economy and Florida property owners, state financial officials said they could find twice as much money in the bond market to cover hurricane losses as they estimated six months ago.

“The picture is definitely better than it was,” said Ash Williams, head of the State Board of Administration, which manages Florida’s investments. “The bond market is loosening up a little bit.”

Williams said the state could expect to finance $8 billion in residential losses – up from an October estimate of $3 billion – and potentially cover losses if a Hurricane Andrew-type storm hits the state this year.

The announcement convinced Gov. Charlie Crist and the Florida Cabinet to abandon plans for extra financing for the state Hurricane Catastrophe Fund. Last year, Crist and the Cabinet paid Warren Buffett’s company, Berkshire Hathaway, $224 million in return for a promise of up to $4 billion in potential loans.

The state is still seeking a federal line of credit in case credit markets dry up after a storm.

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UPDATE: Senate President Jeff Atwater sent word through his spokeswoman that “20 percent is too much.”

Gov. Charlie Crist said the main property insurance bill in the legislature had little chance of passing, calling the proposed 20 percent cap for increases to individual Citizens policy holders “excessive” and questioning whether the measure would get past Senate President Jeff Atwater, R-North Palm Beach.

“As I’m sure you know, Atwater was one of the strongest leaders in giving us the opportunity to strengthen Citizens,” Crist said. “So I don’t know if that’s going to go very far.”

The proposal is expected to contain several changes, including one that would use the state pension fund to loan $2 billion to the Florida Hurricane Catastrophe Fund in the event of a major storm.

Crist said he wasn’t wild about that one, either.

“Getting some backup from the federal government, I think, is a better way to go,” Crist said. “I think it’s very doable.”

Last year, Crist and the Cabinet paid Warren Buffett’s Berkshire Hathaway $224 million for a promise to loan the state $4 billion if a major storm hit the state. This year, Crist and the Cabinet are appealing to the federal government. More on that attempt here.

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A property insurance proposal from Rep. Bryan Nelson, R-Orlando, and Sen. Garrett Richter, R-Naples, would lift a recommendation from the Citizens Property Insurance Corp. Mission Review Task Force and increase rates from the state-run insurer by a statewide average of 10 percent and up to 20 percent for individual policy holders.

The plan, expected to be unveiled in respective committee hearings this week, would also:

* Reduce the capacity of the Hurricane Catastrophe Fund by $12 billion over six years, which could result in Citizens and private insurers raising the cost of property policies. State officials estimate an average annual increase of 3 percent.

*Allow the state to borrow $2 billion from the state pension fund to back up the catastrophe fund in event of a hurricane.

* Use $26 million from the proposed Citizens increases to pay for My Safe Home Florida, which helps homeowners finance new storm windows and fortified roofs.

More here.

Florida Insurance Consumer Advocate Sean Michael Shaw told The Palm Beach Post that lawmakers should let Citizens premiums increase by as much as needed to make the state-run insurer financially sound.

“Whatever the number is that Citizens needs to be at to be actuarially sound, that’s what I advocate,” Shaw said. (Listen here.)

A Citizens task force said that number could be as much as 30 percent statewide. CFO Alex Sink said making Citizens “actuarially sound” could mean a 60 percent jump for some homeowners along the coast, but that lawmakers should aim for less.

“We’ve got to start somewhere,” she said. “We can’t bite off the whole apple, but we’ve got to start beginning to take little bites to get Citizens more on a sound financial footing.”

With lawmakers ready to let a three-year rate freeze expire, Shaw said that he wasn’t asking legislators to cap that increase at a specific number.

He said he didn’t want anyone’s premium to increase, but that a Citizens hike was a “good thing” for homeowners with private insurance policies who are subsidizing those with policies from the state-run insurer.

The Citizens Mission Review Task Force has suggested capping increases at statewide average of 10 percent.

While a three-year freeze on rates from Citizens Property Insurance Corp. expires this year, the state-run insurer is in the midst of reassessing 350,000 coastal properties with wind-only coverage, Post reporter Jeff Ostrowski writes today.

Thanks to a rate freeze that took effect in 2006 and lasts through this year, Citizens policyholders have enjoyed a respite from big jumps in their bills. But homeowners like Baker are seeing premiums soar anyway as the insured value of their property is reassessed.

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“This is in no way a way around the rate freeze,” said Citizens spokesman John Kuczwanski. “It is an effort for us to collect premiums on the actual risk we insure.”

More here.