Regulators approve smaller Citizens Property Insurancerate hike

Oct 2, 2012

The following article was published in the The Florida Current on October 2, 2012:

Regulators approve smaller Citizens rate hike

By Gray Rohrer

Homeowners with coverage under Citizens Property Insurance Corp. will see a statewide average 10.8 percent increase in their rates starting Jan. 1, after state regulators approved the rate increase Tuesday.

Citizens officials had asked for an 11.8 percent increase, but Insurance Commissioner Kevin McCarty said the smaller increase was a “more reasonable approach.”

“The final rates indicate a more reasonable approach toward moving a significant portion of Florida’s demographic to actuarially supported rates. Our primary goal is to ensure Citizens policyholders are treated fairly and retain an opportunity to return back to a robust private insurance market as the Florida Legislature intended,” McCarty said in a prepared statement.

Sinkhole rates will also shoot up next year, but not as high as Citizens hoped. The Office of Insurance Regulation approved a 21.4 percent statewide average increase, 8.2 percent lower than Citizens’ original request. Complete sinkhole devastation, known as “ground cover collapse,” is covered by the Citizens homeowners’ policy, but consumers can add coverage for partial sinkhole damage.

“Citizens is pleased that (McCarty) has approved its measured approach to achieving sound rates and reducing the potential financial burden of assessments for all Floridians. We are committed to working further with Commissioner McCarty and OIR as we move toward actuarially sound rates and seek to identify additional opportunities for our customers to find quality coverage in the private insurance market,” Citizens spokeswoman Candace Bunker said.

Critics of Citizens’ recent moves to lower their risk by reducing coverage and vigorously inspect homes for wind mitigation discounts that often result in an increase in premium, however, were not pleased with the new rates.

“I’m disappointed, very disappointed,” said Sen. Mike Fasano, R-New Port Richey, who has hounded Citizens for reducing coverage on screened in patios and carports, and held rallies against an astronomic sinkhole rate increase request last year. “Citizens has already received a rate request when they removed coverage with no drop in premium.”

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