Florida Approves Citizens Rate Hikes for Condos, Rentals, Commercial

Florida Insurance Commissioner Kevin McCarty has approved additional rate increases for state-backed Citizens Property Insurance Corp. The latest round affects condominium associations, commercial buildings, rental properties and other structures.

Commercial nonresidential rates in high-risk coastal areas will rise by 9.9 percent, while remaining unchanged in non-coastal areas.

Other increases include 10.4 percent for dwelling fire coverage for rental properties; 8.1 percent for commercial residential condominiums and 11.0 percent for condo association wind-only coverage.

On Sept. 23, McCarty approved an average 10.3 percent increase for homeowners and an average 9.2 hike for mobile homes.

Citizens insures about 1.2 million properties, about 750,000 of them homes. It is the state’s largest home insurer.

The effective date of new rates varies between Jan. 1, 2011, and Feb. 1, 2011, depending on the type of coverage.

According to state regulators at the Office of Insurance Regulation (OIR), the approved rates vary slightly and contain both increases and decreases from the rates Citizens requested as a result of using a different methodology to calculate rates. State law caps increases for Citizens to an average of 10 percent a year, plus costs to build up cash in the Florida Hurricane Catastrophe Fund.

High-Risk Accounts (HRA) are policies with wind-only and multiperil coverage for policyholders (residential and commercial) in defined geographic areas near the coast. Personal Lines Accounts (PLA) are comprehensive multi-peril policies to homeowners throughout Florida. Commercial Lines Accounts (CLA) are commercial residential (condominium association, etc.) and commercial nonresidential windâ€only and commercial nonresidential multi-peril coverage throughout Florida.

Approved Rates

The following are the approved statewide average rate increases and what Citizens had requested:

Dwelling Fire (PLA) and (HRA)

Dwelling Fire: 10.4% approved Citizens filed 9.8%

Condo and Ex Condo Commercial Residential (CLA)

Commercial Residential Ex-Condo: 0.7% approved Citizens filed 0.7%

Commercial Residential Condo: 8.1% approved Citizens filed 0.7%

Condo and Ex Condo Commercial Residential (HRA)
Condo Association Wind-Only: 11.0% approved Citizens filed 11.5%

Condo Association Ex-Wind: 11.3% approved Citizens filed 11.7%

Commercial Nonresidential (HRA)

Commercial Nonresidential: 9.9% approved Citizens filed 9.1%

Commercial Nonresidential (CLA)

Commercial Nonresidential: no change Citizens filed: no change

The following exhibits with approved rates are available on the OIR web site:

10-15317 CRM Class Rated Apartments

<http://www.floir.com/pdf/CRMApts.pdf>

10-15436 CRM Class Rated Condominiums

<http://www.floir.com/pdf/CRMCondos.pdf>

10-15469 CRW Class Rated Apartments

<http://www.floir.com/pdf/CRWApts.pdf>

10-15058 Dwelling Fire

<http://www.floir.com/pdf/DwellingFire.pdf>

Topics Florida Commercial Lines Pricing Trends Homeowners