Insurance industry after influence

Companies contribute millions, creating unique conflict

BY PAIGE ST. JOHN
FLORIDA TODAY

Campaign finance records through December show the insurance industry — a broad category that includes life, health, auto and home insurers as well as their agents — gave nearly $24 million to candidates in the 2006 state races.

Those companies are now trying to lobby a governor and Legislature intent on showing the public just how much it doesn’t like insurers. A special session to deal with insurance reform begins today, as Floridians wait to see whether their state Legislature can overcome its hands-off attitude toward the problem of rising insurance premiums in Florida.

The top recipient of insurance contributions was Gov. Charlie Crist, who received almost $800,000 from an industry he continues to say is reaping excess profits, while the Republican Party of Florida took another $11 million.

It is important to recognize that insurance contributions come from a divergent industry, said Senate Banking and Insurance Chairman Bill Posey, who collected more than $31,000 of such money in 2006.

“We deal with viatical insurance (the resale of life insurance policies), we deal with property, we deal with auto, we deal with medical malpractice,” Posey said. “So break it down into what category it was.

“There’s a big difference in the interest of agents and the interest of companies.”

Still, property insurers remain a significant part of the total and the proposals for property insurance in this week’s special session will affect many lines of business, including auto-only insurers.

At a time when politicians across Florida shun ties to the much-maligned insurance industry, one man was taking all the insurance cash as he could get.

Not anymore.

Sen. J.D. Alexander, a Lake Wales citrus grower vying to become Senate president in four years, has relinquished more than $1 million he raised and kept in two political accounts he used to curry support for the leadership post.

Alexander moved nearly $1 million to the Florida Chamber of Commerce’s political committee. In October, he gave the last $57,000 to the Republican Party of Florida.

Alexander acknowledges the funds were heavy baggage — insurance contributions made up more than a third of the $1.1 million in his war chests.

The biggest checks came from Well Care, the Tampa-based managed care contractor, but Florida Peninsula, an insurance start-up that increased rates after taking over policies from Citizens Property Insurance, contributed $25,000.

“There was a perception that it might have influenced me,” Alexander said. The Senate insurance committee member said that perception is wrong.

“You know me, I’m pretty hard-headed. I’m going to do what’s right,” he said. “The last thing I want to do is give people pause to how I recommend action.

“I gave it to the party and that eliminates it as an issue.”

Though the insurance industry is being demonized in public, its lobbyists still have access to lawmakers.

State Farm Florida lobbyist Mark Delegal on Thursday could still pull off a meeting with House Speaker Marco Rubio, and State Farm Florida vice president Joe Formusa spoke with Chris Kise, legal adviser to Gov. Charlie Crist.

“I couldn’t say we’ve had trouble, but the body language is different,” Delegal said. “There’s a new component that has not been here before, and it’s a major political component.”

State Farm agents contributed $284,000 to a governor and Legislature now attacking the national insurer and its state subsidiary.

Though there is much they don’t like, insurance companies have not attacked current House and Senate legislation directly. Instead, opposition has come from more general state business lobby groups, of which Florida’s major insurers are a part.

Associated Industries of Florida and the Florida Chamber of Commerce both released detailed criticisms of proposals to curtail insurance profits and clamp down on insurance companies taking only the state’s most profitable business, leaving others to take on unwanted hurricane risk.

“We’ve taken it upon ourselves to sound the alarm,” said Barney Bishop, president of AIF. “Our greatest fear is that in the rush to solve this crisis, we will wind up with fewer insurance companies doing business in Florida.

“We need a carrot, not a stick.”
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