David Jolly’s state-run insurance plan has sparked debate across Florida as the Democratic gubernatorial candidate introduces a proposal to overhaul how hurricane and natural disaster coverage is handled in the state. The plan aims to address Florida’s ongoing property insurance crisis by shifting catastrophe coverage from private insurers to a new state-managed fund.

David Jolly’s State-Run Insurance Plan in Florida

David Jolly, a Democratic candidate for governor, has outlined a bold insurance reform plan that would create a state catastrophic fund responsible for covering all natural disaster losses in Florida. According to Jolly, this proposal would remove hurricane and disaster coverage from the private insurance market, leaving private companies to cover only non-catastrophic risks such as fire or theft.

Jolly claims the move could cut private insurance premiums by as much as 60%, since the most expensive risk—hurricanes—would no longer be borne by private insurers. The plan comes amid persistent high insurance costs for homeowners, who pay some of the highest premiums in the United States. Recently, there have been positive developments, such as Florida Peninsula Insurance proposing a historic rate cut for homeowners, signaling potential relief in the market.

Background: Florida’s Insurance Crisis

Florida’s property insurance market has faced significant challenges for years. Homeowners have seen premiums rise sharply due to several factors, including litigation, fraud, and soaring reinsurance costs. According to the Florida Legislature and the Florida Catastrophe Fund, recent legislative reforms and state-backed reinsurance programs have not led to substantial rate relief for most residents.

Litigation and Fraud

State leaders have cited excessive lawsuits against insurers as a key driver of premium increases. In 2022, lawmakers enacted measures to limit litigation, but critics argue these changes have not produced the intended savings for homeowners.

Rising Reinsurance Costs

Insurance companies in Florida must purchase reinsurance—insurance for insurers—to protect against major losses. With Florida’s high hurricane risk and climate change impacts, reinsurance costs have surged, directly increasing homeowners’ bills. The impact of these rising costs has contributed to a recent trend where property insurance companies in Florida are seeing profits surge despite ongoing challenges for consumers.

Market Shrinkage and State Subsidies

National insurance carriers have exited the Florida market, leaving smaller firms with less financial stability. These smaller companies must buy more reinsurance, which further raises premiums. In response, lawmakers created two state-backed reinsurance programs—RAP and FORA—providing $3 billion in subsidized coverage. However, most of these funds went unused, and $2.1 billion was returned to the general fund in 2025, according to the Florida Legislature.

Details of Jolly’s Insurance Proposal

Jolly’s plan would establish a new state catastrophic fund to cover all natural disaster losses, including hurricanes and floods. This approach differs from the existing Florida Catastrophe Fund, which serves as a backup reinsurance source for private insurers and only covers mid-range storm losses.

Under the proposal, private insurers would continue to offer policies for other risks, such as fire and theft, while the state would assume responsibility for catastrophic events. Jolly compares his plan to government programs like Medicare and Medicaid, where the state intervenes when private markets cannot provide affordable coverage.

Potential Impact on Insurance Premiums

According to Jolly, removing hurricane and disaster risks from private policies could reduce private insurance premiums by about 60%. Supporters argue this would make homeownership more affordable and attract new residents and businesses to Florida.

Industry and Expert Reactions to the State-Run Insurance Plan

Jolly’s proposal has drawn mixed responses from insurance industry leaders, consumer advocates, and policy experts.

Concerns from the Insurance Industry

Mark Friedlander of the Insurance Information Institute opposes the plan, citing the National Flood Insurance Program’s significant debt as a cautionary example. He argues that government-run insurance solutions are not effective and warns that removing disaster coverage from private insurers could destabilize the market.

Industry representatives also point to California’s FAIR Plan, which provides limited and expensive wildfire coverage, as evidence that state-run programs can have drawbacks for consumers.

Support and Cautions from Analysts and Advocates

Some experts see merit in Jolly’s proposal. Gavin Magor with Weiss Ratings notes that Floridians are accustomed to managing multiple insurance policies, such as Medicare and Medigap, and believes a state-run catastrophe fund could diversify risk and ultimately lower premiums.

Lisa Miller, former deputy Florida insurance commissioner, expresses skepticism, warning that shifting all disaster risk to a public entity could leave taxpayers responsible for large losses after major storms.

Doug Quinn of the American Policyholder Association emphasizes the need for effective regulation before removing catastrophe coverage from the private market. He calls for greater oversight from the Florida Office of Insurance Regulation and the Florida Division of Financial Services to ensure accountability.

Birny Birnbaum of the Center for Economic Justice supports efforts to address the insurance crisis but suggests that insurance companies should maintain some financial responsibility to encourage sound market practices.

Comparisons to Other State and Federal Insurance Programs

Opponents of Jolly’s plan often reference the National Flood Insurance Program, which has accumulated substantial debt, as a potential risk for Florida. They also cite California’s FAIR Plan as an example of a government-backed program with limited benefits and high costs. Meanwhile, Florida’s property owners continue to face unique challenges, including condo insurance challenges, roof inspections, and policy cancellations, that highlight the complexity of the state’s insurance landscape.

Supporters argue that Florida’s unique exposure to hurricanes and natural disasters requires a new approach, especially given the persistent challenges in the private insurance market.

Political Context and Next Steps

Jolly is the first major candidate in the 2026 Florida governor’s race to propose a comprehensive overhaul of the state’s property insurance system. According to official sources, other candidates are expected to introduce their own plans in the coming months.

The debate over Jolly’s state-run insurance plan is likely to become a central issue in the election, as voters weigh the potential for lower premiums against the risk of increased public debt.

Details of the proposal and its potential impact may be updated as the legislative process and public discussion continue, according to information from the Florida Legislature and the Florida Catastrophe Fund.

Frequently Asked Questions About David Jolly’s State-Run Insurance Plan

What is David Jolly’s state-run insurance plan for Florida?

David Jolly’s plan would create a new state catastrophic fund to cover all hurricane and natural disaster losses in Florida. Private insurers would continue to cover other risks, such as fire or theft.

How much could homeowners save with the proposed insurance plan?

According to Jolly, private insurance premiums could drop by about 60% if hurricane and disaster coverage is removed from private policies. Actual savings would depend on legislative approval and implementation details.

Are there risks to a state-run insurance program in Florida?

Industry experts warn that a government-run program could lead to significant public debt if major storms cause widespread losses. Some point to the National Flood Insurance Program’s debt as a cautionary example.

Can you still get private insurance for hurricanes under this plan?

No, under Jolly’s proposal, hurricane and natural disaster coverage would be handled only by the new state fund. Private insurers would offer policies for other types of damage.

Where are the highest property insurance premiums in Florida?

Homeowners across Florida, including areas like Port St. Lucie and the Treasure Coast, pay some of the highest property insurance premiums in the nation. The proposed plan aims to address these high costs statewide.

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