A bill filed in the Florida House of Representatives would revise how the Florida Hurricane Catastrophe Fund sets its industry-aggregated retention and calculates participating insurers’ retention multiples, marking another adjustment to the state’s catastrophe financing framework.
House Bill 1349 would require the hurricane fund to set its base retention at $8.5 bn, nearly doubling the $4.5 bn level required under current statute.
The higher threshold would apply across the market, reshaping how losses attach for participating insurers.
Under the proposal, insurers opting for 100% coverage would see their individual retention multiples fixed at 90% of the $8.5 bn base.
The bill ties the calculation directly to the new aggregate figure, reducing discretion around how multiples are set.
HB 1349 also changes how insurers recover expenses.
Fund contracts would be required to reimburse insurers for loss adjustment expenses at the coverage level they select, expanding beyond the current framework, which only mandates reimbursement for insured losses.
The bill establishes a new formula for loss adjustment expenses. Reimbursement would be capped at the lesser of 25% of total subject losses before reimbursement or the insurer’s actual subject loss adjustment expenses. Existing law applies a flat 10% rate, regardless of actual costs incurred.
Another structural change appears in the fund’s capacity limits. The legislation would cap the hurricane fund’s annual contractual obligations at $17 bn, removing the board’s authority to raise that ceiling when projected capacity exceeds estimated claims.
If enacted, the changes would take effect for the contract year beginning June 1, giving insurers limited time to adjust their reinsurance planning and capital strategies.
The bill is sponsored by Hillary Cassel, a Republican representing District 101. Attempts to obtain comment from Cassel were unsuccessful.
The proposal arrives as Florida officials point to stabilisation in the insurance market following recent tort reforms and legislative changes.
Policyholders at Citizens Property Insurance Corp. will receive an average statewide homeowners rate reduction of 8.7%, according to an announcement from Governor Ron DeSantis. Homeowners in South Florida are positioned for even steeper cuts under the new rate structure.
The reduction goes well beyond the 2.6% decrease Citizens filed for in December, which itself marked the first rate cut approved by the insurer’s board since 2015.
Under the revised plan, more than 330,000 policyholders will see lower premiums, and over 150,000 of them will receive reductions of at least 10%.
Multiperil homeowners policies will see an average statewide decrease of 8.7% when they renew this spring. The change marks the largest Citizens rate reduction in years and sharply exceeds the figure the insurer initially put forward.
DeSantis said the earlier filing included only modest relief and left too much on the table. Regulators declined to approve it as submitted and instead modified the proposal to deliver more meaningful savings to policyholders.
In July, 2025, Florida Gov. Ron DeSantis signed a bill reducing available funds for the state’s Reinsurance to Assist Policyholders program by $1.1 bn and eliminating the dormant Florida Optional Reinsurance Assistance program.
House Bill 5013, chaptered on July 3, lowered funding for the RAP program from $2 bn to $900 mn. RAP reimburses participating carriers for hurricane-related losses.
Created in 2022, the program allocated $2 bn in tax money to expand capacity for the Florida Hurricane Catastrophe Fund. In return, participating carriers agreed to reduce rates.
However, RAP outlays never reached the funding level earmarked for the program. Between 2022 and 2023, three covered events occurred, but only Hurricane Ian was significant enough to trigger RAP coverage.
