Florida Insurance Commissioner Kevin McCarty rejected a request by Citizens Property Insurance Corporation (Citizens) to increase rates in Monroe County and ordered it to reduce homeowners insurance rates for the area.
By law, Citizens rates have to be higher than private insurers’ rates in all areas of the state. However, Monroe County has been found to not have a competitive insurance market, therefore rates are only required to be actuarially sound. Citizens is the state-run insurer for those who cannot access insurance in the private market.
Citizens had asked for approval to raise rates in Monroe County by 25.9 percent for homeowners’ policies, however, McCarty ordered it to reduce rates by 32.2 percent. Citizens had also asked for approval to increase mobile home rates by 20.4 percent, but McCarty ordered a lesser increase of 15.2 percent. Pursuant to the order Citizens will be required to refund any premium collected in excess of the ordered rates for the period it had instituted the rate hike.
In both cases, McCarty based the difference in rates contained in the order on results derived from Florida’s public hurricane model. The rates now will be comparable to rates charged in areas of similar risk in the state.
“Many Floridians are struggling to pay rapidly rising hurricane insurance costs, and perhaps none more so than those living in Monroe County,” said McCarty. “We will continue to aggressively scrutinize all rate requests and where we find that rates are not justified we will not allow them.”
A televised public hearing on the Citizens rate filing was held in Key West on Aug. 1. Officers of Citizens were questioned at the hearing by senior staff and counsel from the Office of Insurance Regulation, by representatives from Monroe County, and by the advocacy group Fair Insurance Rates for Monroe County.
Source: Florida Office of Insurance Regulation
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