The Miami Herald doubled down today on its failure to address the shortcomings of undercapitalized, undiversified newly minted under-regulated Florida home insurance companies. (See Citizens Insurance May Be Bad, But Consider the Alternatives for yesterday's installment.)
On the editorial page today, the Herald starts off well in Storm warning: Prop up insurance noting that “the system for insuring homes and businesses against disaster remains badly flawed.” And this is good too:
Neither Citizens nor the CAT fund has sufficient cash on hand — nor enough borrowing power — to meet the huge outlays required by the proverbial one-in-100-years storm. The result would be harsh rates on Florida homeowners to make up for the shortfall.
But then we go off the rails:
The picture isn't completely grim. Since the start of 2008, a record number of policies — 500,000 — have been taken out of Citizens by newly formed insurance companies. That's a good sign, but Citizens remains the largest state-run insurance pool in the country.
No, it's not a good sign at all if the companies writing those policies are not safe and sound. And there's no reason to think that most of them are anything like it.
Why is the Herald so badly missing the boat on this issue?