Mandated Hurricane Catastrophe Fund on car insurance

[disneykid52]

What is the name of your state (only U.S. law)? Florida
Does anyone know why this is mandated on car insurance and how would (does) it benefit me? Seems like I'm forced to pay for somethying I dont need.

 

[ecmst12]

Try google.

 

[justalayman]

The wealth of the entire insurance industry is based on people buying insurance they will never make a claim against. It wouldn't make sense nor could you afford buying the insurance if every policy written was written with the intent all payments would be offset by claims made.

 

[latigo]

What is the name of your state (only U.S. law)? Florida
Does anyone know why this is mandated on car insurance and how would (does) it benefit me? Seems like I'm forced to pay for somethying I dont need.

Well you are correct in the sense that it only “seems” that you are required to carry such property and casualty insurance. But it is not because of existing Florida law which only deals with mandatory minimum liability coverage for bodily injury, death and property damage. *

Your state couldn’t care less whether or not your vehicle is covered by loss due to collision, fire, flood, theft, wind, meteorites or any form of available property and casualty insurance.

If you feel that you are being "forced" to carry casualty insurance covering the catastrophic losses mentioned, it could be because the people carrying the paper on your auto loan have required it

But if so, that would be by contract and not per law. And no one to may knowledge has ever put a gun to anyone's head forcing then to take out an auto loan.
__________________


[*] Florida Statutes Title XXIII Chapter 324 “Financial Responsibility”)

 

[ecmst12]

Wrong again, latigo. The fund has nothing to do with first party coverages. Try google.

 

[justalayman]

so, it is a fund to repay the insurance company's that provide coverage for companies writing policies on residential property.

If Disney lives in florida, somewhere along the line she benefits from this fund.

Does anyone know why this is mandated on car insurance

yes


and to be more complete: it's because there is a law stating such

how would (does) it benefit me?

either through a direct purchase of residential property insurance or a limitations of the overhead a landlord must pay on their rental properties, you benefit by a reduced cost of those policies. The fund allows the insurance providers to not charge what their studies show they should actually charge for any given policy. Granted, you pay at least some of that reduction in the assessment on all insurance policies but I suspect their is an overall reduction in your costs.

 

[latigo]

Wrong again, latigo. The fund has nothing to do with first party coverages. Try google.

Well, as the good Lord knows, not to mention some shortsighted jurists, I’m seldom right. But am I to blame because the OP failed to ask the right question?

Besides as the Baltimore Sun’s oft quoted journalist, H. L. Mencken wrote: “For every complex problem there is a solution that is simple, neat and wrong.”

 

[disneykid52]

. If you feel that you are being "forced" to carry casualty insurance covering the catastrophic losses mentioned, it could be because the people carrying the paper on your auto loan have required it

My car is paid for. Paid cash (literally) when I bought it brand new.

 

[justalayman]

My car is paid for. Paid cash (literally) when I bought it brand new.

so, since that is irrelevant anyway:

do you live in Florida and either pay rent or own a home where you have purchased insurance? If so, you benefit from paying into the Hurricane fund by it allowing insurance rates to be suppressed due to the government placing a stop loss limit on the insurance company's liabilities for hurricane damage payouts on residential properties.

 

[disneykid52]

so, since that is irrelevant anyway:

do you live in Florida and either pay rent or own a home where you have purchased insurance? If so, you benefit from paying into the Hurricane fund by it allowing insurance rates to be suppressed due to the government placing a stop loss limit on the insurance company's liabilities for hurricane damage payouts on residential properties.

Yes I live in Florida but no I do not pay rent nor do I own a house. So I still dont understand how I benefit (coverage-wise). Is it going to pay me anything if I (who is not going to stick around if a hurricane is going to be paying Florida a visit)?

 

[justalayman]

Yes I live in Florida but no I do not pay rent nor do I own a house. So I still dont understand how I benefit (coverage-wise). Is it going to pay me anything if I (who is not going to stick around if a hurricane is going to be paying Florida a visit)?

so you are one of the denizens of the cardboard box community?


is it going to pay you anything? no, that is not the purpose

it is paid to the insurance companies to cover hurricane claims they pay out on residential damages when the total of the claims breach some specified level.

an insurance company sets rates based on studies regarding their exposure for any given situation and how much they are likely to pay out due to that. If they set their rates on just that, I presume any hurricane insurance written if Florida would be extremely costly. This effectively reduces the rates for said coverage.

Without that fund, the insurance companies could see it not fiscally possible to offer hurricane coverage at all. If that were the case, it just wouldn't be available. Can you imagine the problems that would cause?

 

[disneykid52]

so you are one of the denizens of the cardboard box community?

(((buzzer))) WRONG!!! care to try the bonus round? Try RV (travel trailer)

 

[justalayman]

(((buzzer))) WRONG!!! care to try the bonus round? Try RV (travel trailer)

Those are simply very fancy cardboard boxes. Been to too many of the factories that build them to think otherwise.

 

[ecmst12]

Whether or not you would ever personally benefit from the fund is completely irrelevant.