This loan is the first “transaction resulting from the Senate bill 1980 passed by the Florida State Legislature and signed by Governor Bush into law on May 16th.” The loans are given out to Florida homeowner insurers, with credit worthiness and in good standing, able to demonstrate a stable business plan and ability to repay the State over a 20 year term.”
St. Johns started their business at the worst possible time, the end of 2003, right before two consecutive heavy storm seasons. Despite the amount of storms they stayed in business but have been forced to stop offering policies in certain counties due to “saturation and lack of capacity.” Because of the new loan they will be able to re-enter those counties and project writing more than 100,000 policies by the end of the year and at least 200,000 by the end of 2007.
The bottom line is homeowners in Florida need options to purchase their insurance policies. While this loan and future loans like it are a short-term fix they will hopefully provide a foundation for re-building a solid insurance presence in Florida.
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