Launch Pad

October 13, 2023

Public Policy Update

Hello everyone. This week, members of the Florida Senate met in Tallahassee for the second interim committee week leading up to the 2024 Legislative Session which begins on Jan. 9th. Just about every Senate committee held a meeting this week, but I wanted to zero in on the Banking & Insurance Committee, which met on Tuesday, since property insurance is one of our biggest legislative priorities.

Before I talk about the committee meeting, I wanted to take a quick minute to answer a question that routinely comes up when we are out giving presentations to our members. Namely, with property insurance rates so high, why can’t we just cap insurer rates? The answer is relatively simply, but the information behind it is not. Thankfully, the Personal Insurance Federation of Florida (PIFF) released a resource highlighting how rates are made, and outlining key factors that determine the cost of insurance. With this information in mind, it’s important to realize that insurers are heavily regulated, and that Florida law does not allow insurers to charge rates that are too high or low. 

But what if current law was changed to allow state regulators to cap rates? The answer would be an exodus of private insurers from the state, leaving only Citizens to insure the state’s entire homeowner population. Citizens is already charging well below actuarial sound rates, which means every single policyholder in Florida would be on the hook to cover the losses that occur from storms and other natural disasters no matter where they occur in the state. 

Okay, back to this week’s Banking & Insurance Committee meeting. During the meeting, lawmakers received a comprehensive update on the status of Florida’s property insurance market by Florida’s Insurance Commissioner, Michael Yaworsky. They also heard from Tim Cerio, the CEO of Citizens Property Insurance Corporation. Finally, they received a presentation on the My Safe Florida Home Program that we helped champion the last two years. 

You can listen to the full committee meeting here if you want to hear some of the dialogue from lawmakers during the presentations. The committee briefing packet, which includes the slides from the various presentations can be found here. I’d encourage you to look through it because it gives a much more complete picture of the current situation, such as new carriers entering the market, a more positive reinsurance outlook, lower litigation rates and hundreds of thousands of Citizens policies being approved for take-out, as opposed to some recent news articles that seem to focus only on the negative.  

If you don’t have time to review all these materials then the gist of the committee meeting was this – yes things are still very challenging out there in the market, but the reforms passed in the last few sessions are beginning to take root and positive things are happening. And while lawmakers may not push major insurance legislation this year, it is going to continue to be a major discussion point in the halls of the Capitol and in the meetings we have with lawmakers during session and throughout the year.  

Governor Desantis Signs Executive Order Regarding Impacts of War in Israel

Yesterday, Governor DeSantis signed Executive Order 23-208 (Emergency Management – Impacts of War in Israel). There are more than 20,000 Americans, including Floridians, in Israel who wish to return home but are unable to do so. This Executive Order allows the State of Florida to carry out logistical, rescue and evacuation operations to keep its residents safe. Specifically, this order enables the Florida Division of Emergency Management to bring Floridians home and transport necessary supplies to Israel. To read the full executive order, click here.

NAR Heads to Trial on Monday Regarding Pro-Consumer/Pro-Competition Rules

The National Association of Realtors®, along with HomeServices of America and Keller Williams Realty, begin trial Monday in Kansas City, Mo., in the case Burnett et al v. National Association of REALTORS® et al. NAR will present the facts and law about its pro-consumer, pro-business competition rules that plaintiffs in the case are calling into question.

In the trial, set to begin Oct. 16 with a verdict expected by Nov. 10, plaintiffs allege commission rates are too high, buyer brokers are being paid too much, and NAR’s Code of Ethics and MLS Handbook, along with the corporate defendants’ practices, lead to set pricing. The case covers the Kansas City, Mo.; St. Louis; Springfield, Mo.; and Columbia, Mo., markets.

The Case NAR Will Make:

The very reason NAR exists as a trade association is because there was a need, identified more than 100 years ago, for a higher level of ethical practice in real estate. The further realities are:

• Compensation is set between brokers and their clients and is always negotiable. (Watch this video on how to explain your compensation to clients.)
• Commission rates are market-driven and have fluctuated over time. Those costs are spelled out to buyers and sellers, and NAR doesn’t tell anyone what to charge.
• The free market and competition are encouraged by NAR.
• There’s incredible value in using a real estate agent, especially a REALTOR®, when you buy or sell your home.
• REALTORS® look out for their clients above all else, and buyer brokers exist because consumer protection advocates thought they were important.
• Article 1 of the NAR Code of Ethics requires a REALTOR® to “protect and promote the interests of the client.” NAR also has rules that prohibit antitrust behavior.

Read the full story about the trial, including what’s at stake, potential outcomes and what you can do here.

NAR Recaps the Power of Realtor Advocacy in Averting Government Shutdown

NAR took a moment to recap all the work and advocacy that went into the nation-wide effort to avert last month’s government shutdown scare which would have caused a devastating lapse of the National Flood Insurance Program (NFIP). The article talks about how Realtor® advocacy helped avert the shutdown, including details of the rare nationwide call for action that took place, and the work that lies ahead as another deadline looms next month.

NAR Supports New Legislation Protecting Independent Contractor Status

About 87% of the nation’s 1.5 million Realtors® are classified as independent contractors. The Direct Seller and Real Estate Agent Harmonization Act (H.R. 5419), introduced in the House last month and supported by NAR, seeks to amend the Fair Labor Standards Act of 1938 to clarify the definition of “employee” by incorporating the Internal Revenue Code recognition of direct sellers and qualified real estate agents as independent contractors. Read more about this news here.

Please reach out to us at publicpolicy@floridarealtors.org with any questions you may have.