State Legislature Tries to Simplify Homeowner Insurance Policies TALLAHASSEE (WUSF) - Say you've fallen in love with a beautiful little home on the type of street you've always wanted to live on with great local amenities, nice neighbors and so on. You decide you're going to buy the house- so you make a offer on the house, the seller accepts, and the bank says they'll front you the money, after you get some insurance.

WHITWORTH: " And then you also have I'm sorry, that's not coverage B. Coverage B is other structures, which is ten percent, or 2000 dollars of your home "

Insurance can be confusing. Just ask Lisa Whitworth, a personable and knowledgeable, homeowners insurance agent for the past fifteen years. For a homebuyer, the sit down with the agent comes right at the end of the purchasing process. Lisa says often times a buyer is antsy and restless, ready to sign any piece of paper with a dotted line.

WHITWORTH: "They hear you, but they don't really hear you. And unfortunately most people don't learn that until the time of the claim, and then they figure out 'Oh well, I should have had a million dollars on my liability-I didn't realize a guy could get this hurt tripping on my ladder in the front yard."

Lisa says she would like to see simplified policies. And after last year's horrendous hurricane season, and the cleanup that followed, the legislature agreed. They created a commission made up of consumer advocates and representatives from the insurance industry.

MAHLER: "Almost all the complaints we receive pertaining to homeowners is a disagreement or lack of understanding of what is covered. In their attempts to remedy it they contact us."

That's Rick Mahler with the state's Department of Financial Services. He also chairs the committee spearheading policy recommendations. Mahler says two things can be done to prevent confusion for the consumer. First, insurers must provide an easy to read, well laid out checklist of coverage. Something that resembles the bullet points on a resume.

MAHLER: "And the other part, which is the standard policy, would be letting consumers know what is the standard in Florida, so they can compare it to whatever coverage they're being offered by a particular carrier."

Insurers support the idea of a checklist, because it's mandated by statue and they don't want to go near a standard coverage package.

A standard package would be drafted by the state, either by the legislature or the Insurance commissioner's office.
The draft would outline what the state believes should be offered in a policy. And whenever a buyer purchases a policy, there would be two sets of documents to review.

The one they're buying, and the one the state thinks they should buy.
Insurance executives, like Southern Fidelity Insurance company president Jim Graganella, aren't happy about the proposal.

GRAGANELLA: "I think we're going to have a hard time dictating to the consumers this is the only thing we can sell and this is what they need to sell."

Graganella and other insures say the fragile insurance industry can't handle anymore heavy handed regulation. They add that Texas is the only state to try a standard policy, and that experiment failed miserably. Texas has since eased regulations after many insurers left the state.

Advocates of the changes say the industry is using extreme examples to shoot down any thing that helps consumers comparison shop. One thing both sides of the committee agree on, it will be hard to reach a compromise on a standard policy by the middle of January. That's when the committee will have to turn it's recommendations in to the legislature.

In Tallahassee, John Sepulvado WUSF 89.7 News.
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