Hartford loses bid to raise insurance rates
Jun 3, 2008
State regulators denied Hartford’s rate request, but the company can still ask a state appeals court for one last review.
BY BEATRICE E. GARCIA
Miami Herald--June 3, 2008
State regulators denied a nearly 40 percent insurance rate increase sought by The Hartford Companies, noting the request wasn’t fully justified in the company’s rate filing last year. The order Monday from the Office of Insurance Regulation follows a ruling by an administrative law judge in March, supporting the agency’s initial denial of Hartford’s request. Hartford challenged the regulatory agency’s rejection late last year and asked for a review by the Division of Administrative Hearings. Insurance Commissioner Kevin McCarty said the administrative law judge’s “supportive decision will further help us in our endeavors to protect Florida consumers from unwarranted rate increases.” The agency also indicated Monday it planned to issue a final order denying a rate-hike increase by Florida Farm Bureau Insurance in coming weeks. In April, an administrative law judge recommended that its rate increase also be rejected. In keeping with the insurance law passed in January 2007, aimed at lowering insurance rates for Florida residents, Hartford initially filed an average 13.6 percent rate decrease for its companies operating in the state. But the company later revised its request, asking for a 39.6 percent average increase, even after it had bought lower-cost back-up insurance from the Florida Hurricane Catastrophe Fund. The 2007 law required that insurers pass savings from the reinsurance purchase to policyholders. About 60 percent of the companies operating in Florida complied with the law, said Tom Zutell, a spokesman for the Office of Insurance Regulation. But for 40 percent — 54 companies — final rate requests were disapproved. Those companies now have in place initial rate cuts made in keeping with the new law. The company’s Hartford’s subsidiaries cover more than 100,000 residential policies in Florida.