532,000 Fla. Mobile Home Owners Could Face Costly Premium Increases

February 14, 2005

Six months after four hurricanes tore through Florida, more than 532,000 mobile home owners in the state could soon face costly premium increases or lose coverage according to Sam Miller, executive vice president of the Florida Insurance Council. Miller was quoted extensively in the state's Sunday daily newspapers.

"There is no doubt that mobile home insurance is going to go up," said Miller.

Concerns about mobile home coverage helped prompt state Chief Financial Officer Tom Gallagher to order property insurance companies to freeze rates temporarily. Kevin McCarty, the state's chief insurance regulator, responded by asking insurance companies to delay new rate requests until after the Legislature examines the property insurance system this spring.

Valerie Beynon, a spokesperson for the Florida Insurance Commission, said her office has received notice from only one company, Auto-Owners Insurance, that it will end its mobile home business in Florida.

Don Hazelton, president of the Federation of Manufactured Home Owners of Florida, said he is particularly concerned about the effects of costlier insurance on seniors. Hazelton said many seniors may not be able to afford either hefty rate hikes or a switch to Citizens Property Insurance, the state-created insurance of last resort.

Citizens had 36,000 mobile home policies last Dec. 31, a fraction of its nearly 900,000 total. But the number of mobile homes increased 38 percent from the previous year.

Mullin said the future might be increasingly bleak for owners of older mobile homes.

If last year's hurricanes prove to be more than an anomaly, "the repercussions are going to be felt everywhere," Mullin said. And those hurt the most will be "people that can least afford it. Those are the hard, cold facts."

One potential insurance wildcard for mobile-home residents could be the age of their homes. Those built since 1994 have been subject to more stringent regulations, which officials say helped new homes better weather last year's hurricanes.

Frank Lake, senior vice president and chief operating officer of Gainesville-based Safeway Property Insurance Co., said his company -- which sells insurance only on manufactured homes -- resumed writing new policies Dec. 1 after a nearly three-month break because of the hurricanes.

But he said about five companies that specialize in mobile-home coverage are not renewing policies.

"They want to plain old back away from the market," said Lake, whose company has 44,000 policies.

Hazelton said he is trying to gather information about companies refusing to renew policies. He is getting reports of a "massive number of canceled policies."