If an insurance company sold you a homeowner’s policy knowing that, if disaster was to strike, it probably couldn’t pay your claim, you would call that “consumer fraud” – plain and simple. If private insurance companies were to instigate such a scam, the insurance commissioner would be the first to step in and halt these insolvent business doings, even going so far to working to put these crooks behind bars. At least, that is what the public expects.

But when Florida’s state-operated homeowners’ insurance company, Citizens, sells you a policy knowing that it may not have the financial reserves to cover your claims should a major catastrophe occur, what would otherwise be considered a fraud is just business as usual. The fact is that Citizens is selling policies to Floridians at predatorily low rates – rates so low it may not be able to pay claims should a major catastrophe occur. Ironically, however, the scheme under way in Florida is occurring with full knowledge and consent of the state insurance commissioner and key state policymakers ….

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