Brandes challenges Jolly hurricane plan, warning Florida taxpayers face exposure.
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“Your scientists were so preoccupied with whether they could, they didn’t stop to think if they should.”
Jeff Goldblum’s unforgettable line in “Jurassic Park” wasn’t really about dinosaurs. It was about hubris — about believing intelligence, ambition and good intentions could outsmart the laws of nature.
Florida is about to be asked whether it learned that lesson.
When Hurricane Andrew struck South Florida in August 1992, it caused roughly $15.5 billion in insured losses. The storm exposed just how vulnerable Florida’s insurance system was: 11 small insurers ultimately failed, capital tightened, and the state was forced to rethink how it financed catastrophic hurricane risk.
That lesson has only become more important. Florida remains America’s hurricane capital. NOAA says 40% of all U.S. hurricanes have hit Florida. The state now has roughly $4 trillion in insured property exposed to hurricane risk. A comparable storm today could generate many tens of billions of dollars in insured losses — not simply because of the storm itself, but because Florida has become far more valuable. Hurricanes aren’t a one-time expense. They’re a randomly recurring financial obligation.
Florida’s response to Andrew wasn’t to eliminate the risk of hurricanes. It was to diversify it. Private insurers retained part of the exposure. The Florida Hurricane Catastrophe Fund assumed another layer. The remainder was transferred into global capital markets through reinsurance and catastrophe bonds. Florida doesn’t simply buy insurance. It buys financial resilience. Every year, billions of dollars are spent to ensure capital is standing by before the next hurricane arrives. That isn’t a waste. It’s the price of making sure the money exists when the wind stops blowing.
David Jolly has proposed one of the most sweeping changes to Florida’s property insurance system since Hurricane Andrew. His plan calls for expanding the existing Cat Fund to fully absorb hurricane and wind coverage, removing that risk from private carriers. The appeal is obvious. Floridians are looking for solutions to lower insurance premiums, and every proposal promising relief deserves a serious hearing. This plan does not deliver that relief.
Jolly’s proposal doesn’t ask Florida to insure fewer hurricanes. It asks Florida’s taxpayers and policyholders to assume far more of that risk themselves.
There is a difference between reducing premiums and reducing risk. Changing who finances the hurricane doesn’t make the hurricane any smaller or cheaper.
The larger question is who should determine the price of Florida’s hurricane risk.
Fortunately, we don’t have to treat the idea as purely theoretical. Florida State University researchers conducted an Expanded Windstorm Coverage Feasibility Study for the Legislature’s Office of Program Policy Analysis and Government Accountability. The central policy question is straightforward: storm risk cannot be eliminated; it can only be redistributed.
That may be the most important principle in the debate because every hurricane insurance proposal is really a catastrophe-financing proposal. The only question is who puts Florida back together when the wind stops blowing.
Today, much of Florida’s hurricane risk is priced by catastrophe models, global reinsurers and investors risking their own capital. Jolly’s proposal would move much more of that pricing into a government-run system, where political pressure would inevitably play a larger role. Hurricanes don’t care about campaign promises. They don’t care about elections. Florida’s hurricane risk should be priced by mathematicians, not politicians.
The FSU study recognizes that concentrating wind coverage in a public entity could stabilize private insurers by removing their largest source of volatility. That is a legitimate policy objective, but one that comes with a potentially extraordinary cost to Floridians. Public insurance structures can rely on post-storm assessments when reserves are insufficient. Citizens itself has described such assessments as Florida’s “hurricane tax.” Those assessments can extend well beyond coastal homeowners, spreading costs across a much broader group of policyholders.
The storm doesn’t change. Who pays does.
Plans like Jolly’s that shift risk from private insurers to the state put taxpayers and policyholders closer to the front line of catastrophe financing. The FSU analysis estimates that such a structure could increase the state’s risk exposure by at least $20 billion. That is the core trade-off Floridians should debate openly.
We’ve seen versions of this movie before.
The National Flood Insurance Program also began with the promise that government could finance catastrophic risk differently. Over time, affordability pressures and catastrophic losses strained the system. GAO reported that FEMA still owed the Treasury $20.5 billion in 2020 even after Congress canceled $16 billion of NFIP debt in 2017.
That doesn’t mean government has no role in catastrophe finance. Florida answered that question more than three decades ago when it created the Cat Fund. The Cat Fund has helped stabilize Florida’s market because it assumes a defined layer of hurricane risk, relies on actuarially indicated premiums and can access multiple claims-paying resources. It proves government can play an important role in catastrophe finance without asking the state to shoulder every hurricane loss.
The real question isn’t whether government belongs in catastrophe finance. It already does. The real question is how much catastrophic risk Florida should deliberately move from the world’s capital markets onto Florida’s own balance sheet. That answer shouldn’t come from campaign slogans. It shouldn’t come from ideology. It should come from math.
Researched, market-driven modifications to the Cat Fund are the answer, not more taxes.
Florida should evaluate the Cat Fund every year using updated hurricane science, catastrophe models, borrowing costs and capital-market conditions. If expanding its role makes Florida more resilient, expand it. If the math points in the other direction, don’t. Good catastrophe policy isn’t about finding the cheapest answer. It’s about finding the most resilient one.
Florida can redesign its insurance market. It can rethink the Cat Fund’s role. It can debate how much catastrophe risk belongs in private markets and how much belongs in public hands.
Jeff Goldblum was right.
The question was never whether we could. It was always whether we should.
Hurricanes don’t negotiate. And in Florida, they always find a way.
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Jeff Brandes is a former Florida state Senator and founder and president of the Florida Policy Project, a nonprofit organization focused on developing data-driven solutions to Florida’s most pressing policy challenges.
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