Florida’s new insurance commissioner has decided to appeal a circuit court ruling allowing State Farm Insurance Co. to opt out of submitting policy-count totals to a publicly available database.
Commissioner David Altmaier, appointed just two weeks ago to succeed Kevin McCarty as the state’s top insurance regulator, made the decision “following a thorough review” of the order issued May 2 by
Leon County Circuit Judge James C. Hankinson, said Amy Bogner, spokeswoman for the Florida Office of Insurance Regulation.
The appeal will be filed in the 1st District Court of Appeal by June 1, Bogner said.
The database, called QUASR, or Quarterly Supplemental Report, collects information from insurers about personal and commercial property insurance policies sold in the state, including by state-run insurer Citizens Property Insurance Corp.
Users can query the database for each quarter since 2009 to learn how many policies were in force, canceled, not renewed or newly bound by dozens of insurers doing business in the state.
By customizing queries, the public can find out how many policies companies manage statewide or in any of Florida’s 67 counties. By comparing across quarters or years, users can find out which companies are canceling or not renewing policies statewide or in specific counties, how many new policies have been written, the total value of insured property and the total value of premiums collected, among other data.
Public records advocates fear other insurers will follow State Farm’s lead, undermining the database’s value to the public.
State Farm sued the Office of Insurance Regulation in May 2014, asserting that its data, which it had been submitting as required by state law since 2004, is protected from public disclosure under the state’s definition of “trade secret.”
Asked about the state’s plan to appeal, State Farm spokesman Michal Brower said the company rarely comments on pending litigation. She said State Farm is seeking to prevent public release of the data “for business and competitive reasons” but noted the company is still reporting it to the state “as part of the regulatory process.”
State Farm’s data shows up in the database through the end of 2013, when it had 361,493 personal residential policies, third-most in the state. In the first quarter of 2009, the earliest searchable period in the database, State Farm had 785,475 policies — more than twice as many.
In its lawsuit, the company said it had withdrawn a 2007 request to keep its data secret during a period it was “writing very limited new business.”
But after the company decided to sell policies in Florida again, it went “to great expense to develop its plans for identifying and rating risks.” Access by competitors to detailed policy tallies “gives them valuable information to use to undermine State Farm’s marketing advantages,” the suit said.
In his order, Hankerson agreed, saying State Farm’s data met the definition of trade secret because it has “independent economic value” to competitors.
After the ruling, then-Insurance Commissioner Kevin McCarty released a statement saying, “I am disappointed in the outcome of today’s ruling and believe this weakens the ability for consumers to access information in this state.”
Barbara Petersen, president of the Florida First Amendment Foundation, said the judge misinterpreted how exemptions to public records laws are created and claimed in the state.
Because the state collects the data in the QUASR database, the public has a right to access that data, Petersen said Tuesday.
“[Hankinson’s] ruling is wrong,” she said Tuesday. “Courts aren’t allowed to balance interests, or to find an exemption. That’s in our constitution. Only the legislature can create exemptions to our right of access.”
Petersen said she’s happy Altmaier’s office plans to appeal the court ruling, especially because trade-secret assertions have increased recently. The Seminole Tribe of Florida recently tried to seal a deposition by its CEO because it contained information about the tribe’s gaming revenues. And applications by nurseries that applied last year for licenses to grow medical marijuana were released by the state with numerous “trade secret” redactions, Petersen said, including names of board members easily accessible on the state Division of Corporation’s site, sunbiz.org.
The Florida Association for Insurance Reform plans to file a brief in support of the insurance commissioner after the appeal is filed, said FAIR President and CEO Jay Neal.
FAIR uses the database to counsel customers and agents about which insurance companies are serving which areas, Neal said.
Those tallies have shifted frequently over the past 25 years in Florida. After Hurricane Andrew in 1992, national insurers started pulling up stakes, forcing expansion of state-run Citizens and then creation of homegrown private insurers to begin shifting the burden from Citizens.
“We rely on that QUASR report to see how many companies are operating and where consumers have choices,” Neal said.
Without State Farm’s participation, Neal said the public can’t know whether the company has followed through on its 2014 statement that it would again write new policies in Florida.
Staff researcher Barbara Hijek contributed to this report.
Source: Sun Sentinel