A bill that would eliminate competition in the truck insurance market by removing risk retention groups passed the Florida House Commerce Committee on Monday.
In spite of vocal opposition to HB57 from trucking and insurance interests alike, and an admission from the bill’s sponsor that the bill is not perfect, the committee members present voted unanimously to approve the bill.
OOIDA Executive Vice President Lewie Pugh testified in person against the bill.
“OOIDA strongly opposes HB57. Florida ranks in the top three of the most expensive states to insure to obtain commercial auto coverage in. On average, small-business truckers in Florida are paying over $17,000 a year in premiums per truck, with some well into $30,000,” Pugh told the committee members. “Florida lawmakers should be doing more to help increase competition in Florida, not decrease it and raise premiums.”
Pugh went on to describe what would happen to Florida truckers if competition was removed from the market.
“The removal of (risk retention groups) would put small-business truckers in a position where they’re either going to have to leave Florida or close their doors to go out of business, whether they’re insured with an RRG or not, due to increased cost,” he said.
Risk retention groups are liability insurance companies owned by their members. They allow businesses with similar insurance needs to pool risks and form an insurance company that operates under state regulated guidelines.
Linda Allen, president of Hardcore Trucking and a member of the OOIDA Board of Directors, was also on hand to testify against the bill.
“I have been insured with an RRG for over 12 years. During that time, I have not had any problems with any claims. They have worked with them and I’ve been able to grow my business based on relationships,” Allen told the committee.
“What I’m concerned about House Bill 57, is that it is going to limit my ability to run the business the way I want to. I’m worried about what insurance company will be left out there to insure me. At the moment, I pay $36,000 a year to insure my two trucks. I’m concerned that if I can no longer use the insurance company I’ve been using, what? How am I going to survive? I’m worried that I may end up having to lay off employees or I may end up even having to shut the doors.”
The only other speaker was a representative from the insurance industry, Paul Handerhan, president of FAIR, the Federal Association for Insurance Reform.
Even Handerhan cautioned against the bill as written.
“We think that there are some unintended consequences that are going to adversely impact local owner-operator truckers in the state of Florida. So I continue to want to work with Rep. Truebow now as the bill moves forward and get it into a better posture,” Handerhan said.
The bill now moves to the Florida House floor for consideration.
A similar bill in the Florida Senate, SB516, is slated for a committee hearing on Wednesday.
More Florida news is available.