The American Insurance Association said when the Floridalegislature reconvenes tomorrow it will be supporting a billdesigned to cut the size of the state-operated reinsurancefund.

AIA said the proposal from State Chief Financial Officer AlexSink would reduce the state reinsurance catastrophe fund coveragefrom $28 billion to $25 billion.

As a result, AIA said, the amount of money the cat fund wouldhave to raise through the issuance of bonds and subsequentassessments on policyholders would be trimmed back.

According to AIA, the bill has won unanimous support in theHouse Jobs and Entrepreneurship Council and is expected to move tothe House floor early in the legislative session.

AIA said it will also urge that legislators begin the process ofreturning the state's Citizens Property Insurance Corporation to atrue insurer of last resort, reversing the course taken last yearthat allowed Citizens to more directly compete with the privatemarket.

Removing commercial and auto policies from Citizens' assessmentbase will also be a top priority, AIA said.

Although property insurance issues are expected to dominate, AIAsaid it also plans to push for legislation to renew the publicrecords exemption for insurers' use of credit scoring models. Thecurrent exemption expires this year.

AIA said it will fight any attempt to weaken or repeal any ofthe legal reforms enacted in 2006, most specifically the repeal ofjoint and several liability.

In addition, the trade group said Florida's civil justiceenvironment continues to pose challenges for insurers, and "AIAwill oppose any measures that attempt to make the state morelitigation-friendly."

Cecil Pearce, AIA vice president, southeast region, said in astatement that the legislature's actions last year had providedproperty-casualty rate relief, but "it came at a high cost:imposing on policyholders a [potential] hurricane tax totalingpotentially billions of dollars that must be paid in the event of amajor storm."

"We hope that legislators will rethink that policy, and insteadlook to long-term, market-based solutions that encourage additionalprivate capital to enter the state's property insurance market,instead of putting a fence around Florida and relying on thegovernment and taxpayers to fund hurricane losses after the fact,"said Mr. Pearce