Hiding profits? If they are reported publicly, how can they be hidden? If anyone knew that it will take 176 years of average annual profits to recover the losses from Katrina from Louisiana, they might understand why profits are necessary for an insurer to stay solvent.
Funny, these readers are allegedly insurance people?? Companies in FL. are NOT charging actuarily sound rates. If they were, no one could afford insurance in the entire state, not just Coastal.
The State of Fl. subsidizing Citizens will END when the next large storm hits. The citizens of FL do not understand the financial risk the State has decided to take. The layer or risk they laid off on Berkshire is only the beginning of what the State would absorb if another Katrina hit that State.
The Federal Govt will just fill the bucket back up and all of us who do NOT live on the coast will pay for those who chose to live on the ocean.
Just like Louisiana, why buy Flood Insurance OR even Homeowners for that matter, when you can cry to the Fed Govt that you would like a new house. Every politician runs to fund these people who decided to TAKE THE RISK of NOT buying adequate insurance for THEIR property.
If my home burns, OR a major brush fire took it down, I would get NOTHING from any govt source. So, I buy insurance and do not take risks I can not afford.
Damn liberal WHINERS.
Just buy insurance or MOVE from the Coast.
I would like to live on the Cliffs in Malibu, CA. but can not afford the risk.
Why do those @#@$#@#’s get FREE asset recovery because they whine?
i can hear it now from the investors and then the state will follow… and then the companies sue the state for not allowing them proper hikes if they truly show they don’t have enough funding or then collapsing because of stupid accounting maneuvers. here we go again, bogging down the courts again!
It’s okay & logical for a company to make a profit & still need to take a rate increase. As the article notes, there have been no hurricanes the past few years. Even with reinsurance, companies need to make a lot in the calm years in order to stay solvent when the big one hits. As I understand it, Auto isn’t much better with all the fraud in PIP.
true, but how can you insist that your not making money but are making money and then ask for an increase in rates? whose double talking whom? glad i don’t live in FL, i’d be suing someone!
As an agent, I have seen more claims in the last two years than I have seen in the last 18 in Florida and that includes all those hurricanes. I’ve also had my suspicions as to which ones were not legitimate. I am all for rate deregulation to bring back the major players AM Best rated companies. We need some competition and choices. I was nonrenewed by State Farm this year and am paying Citizens the rate increase I would have rather paid them. All thanks to Crists grandstanding against them last year when they ask for a rate increase.
The company owners are making a lot of profit but then crying poor to raise rates. They go out of their way to create companies to “manage” them. They own these same companies. I can take money from my left pocket, move it to my right pocket and then walk in to the rate increase approval and show them how empty my left pocket is and I need more money to fill it. I can blame mitigation or sinkholes but in reality I am still trying to hide my profits from the public so they don’t think to harshly of me. There is nothing wrong with a profit but you have to wonder/think about why the companies hide what they are doing with their profits. If the average person knew this was going….
first of all, i used to live in FL… problem, like many of you have said in many entries regarding the status of FLORIDA, is the governor has no clue! he does not understand the insurance, but yet, allows the insurance commissioner to raise rates for the florida casualty. they are still trying to recover the losses from back in 2005 and that is why they have added hurricane cat fund, but why should new policies have to pay that so the past can get paid? it’s a fishy statement.
This is typical whenever a newspaper tries to write an article relating to insurance rates. They almost always try to make the insurance company an evil entity.
The state owns Citizens and it doesn’t have a management company. The state did an actuary review of the rates a year ago and it was found that the rates were 60% of where they should be for Citizens to be actuarially sound. This is the direct result of the governor and other politicians messing with the rates.
Second, the management company provides a service for the insurance company and gets paid for it. If the management company did not exist, the insurance company would have to hire claims staff, adjusters, … to perform the jobs the management company is performing.
It is not as EVIL as the newspaper would like you to think. They should do better research.
The real reason behind the management companies is that when you start an insurance company, Florida restricts investment profits being paid to the investors who are looking for a return for 5 years. There is no such restricition on the management company.
I think the issue is transparency. Whenever anyone questions an insurer’s profits, some people immediately interpret that to mean they don’t believe insurers should make a profit. That’s not always true. It’s not whether the management company deserves money, it’s how much. And it is naive to think that there aren’t at least a few insurers playing games with this set-up and trying to have it both ways. Not all, but some.
If I remember properly, the pup companies were set up to avoid the rediculous surcharges in FL for property. The companies avoided surcharges on all of their business by writing FL coverage in FL only companies. Not trying to hide profit, just avoiding stupid government regulations.
OK. This is now the topic of “the consumer” that will never end. As an independent broker outside of Florida, however in a coastal state I also see this first hand. The average consumer doesn’t understand the insurance business, reinsurance, or the risk that is assumed on coastal property. The continued growth in coastal areas, and the inevitable hurricane risk has done nothing but grow, grow and grow larger. 20 years ago it was basically unheard of for hotels and resorts to be insured for 25-100 million. Nowadays this is pretty much the standard, not just 1 but the beaches are lined up with them. Why? You ask? Because, everyone wants warmer weather for secondary homes, vacation destinations, and retirement locations. Companies are in business to earn profit, when living in these areas expect to pay higher premiums today and in the future. This has become something that will continue to exist and goverment regulation will NOT accomplish it.
If homeowners or business want to see lower rates, the state should allow the market to be opened to everyone. At the beginning rates will be high but when the risk is spread out among companies, rates will be more competitive and Citizens will be the last resort for insurance. For now, Citizens is the major insurer in the state, Amazing isn’t?
The issue at hand is, yes they are making a profit, but is the profit enough? The companies need to charge enough to pay their “bills” and have a large surplus to cover that big storm WHEN it comes. Right now the rates they charge are not enough, which is why the large insurers have left, and are leaving the state.
well, obviously citizens it’s never going to be enough because they had to ask the state to create a hurrican catastrophe fund. not only that, citizens (as a last resort) had been operating at a lower expense because it was supposed to be the last line of defense for insurance. but now that it’s having to pay out, they find themselves in the red and had to request an increase in rates, but because they are so far behind they will have to make several increases overs years to catch up. so what will happen when the next major storm hits? it will probably wipe out citizens! most companies already have a cat fund ready to go. paying their bills comes under the general expenses so that should have been figured into the profit margin. hiding is not!
Hiding profits? If they are reported publicly, how can they be hidden? If anyone knew that it will take 176 years of average annual profits to recover the losses from Katrina from Louisiana, they might understand why profits are necessary for an insurer to stay solvent.
Funny, these readers are allegedly insurance people?? Companies in FL. are NOT charging actuarily sound rates. If they were, no one could afford insurance in the entire state, not just Coastal.
The State of Fl. subsidizing Citizens will END when the next large storm hits. The citizens of FL do not understand the financial risk the State has decided to take. The layer or risk they laid off on Berkshire is only the beginning of what the State would absorb if another Katrina hit that State.
The Federal Govt will just fill the bucket back up and all of us who do NOT live on the coast will pay for those who chose to live on the ocean.
Just like Louisiana, why buy Flood Insurance OR even Homeowners for that matter, when you can cry to the Fed Govt that you would like a new house. Every politician runs to fund these people who decided to TAKE THE RISK of NOT buying adequate insurance for THEIR property.
If my home burns, OR a major brush fire took it down, I would get NOTHING from any govt source. So, I buy insurance and do not take risks I can not afford.
Damn liberal WHINERS.
Just buy insurance or MOVE from the Coast.
I would like to live on the Cliffs in Malibu, CA. but can not afford the risk.
Why do those @#@$#@#’s get FREE asset recovery because they whine?
i can hear it now from the investors and then the state will follow… and then the companies sue the state for not allowing them proper hikes if they truly show they don’t have enough funding or then collapsing because of stupid accounting maneuvers. here we go again, bogging down the courts again!
It’s okay & logical for a company to make a profit & still need to take a rate increase. As the article notes, there have been no hurricanes the past few years. Even with reinsurance, companies need to make a lot in the calm years in order to stay solvent when the big one hits. As I understand it, Auto isn’t much better with all the fraud in PIP.
true, but how can you insist that your not making money but are making money and then ask for an increase in rates? whose double talking whom? glad i don’t live in FL, i’d be suing someone!
As an agent, I have seen more claims in the last two years than I have seen in the last 18 in Florida and that includes all those hurricanes. I’ve also had my suspicions as to which ones were not legitimate. I am all for rate deregulation to bring back the major players AM Best rated companies. We need some competition and choices. I was nonrenewed by State Farm this year and am paying Citizens the rate increase I would have rather paid them. All thanks to Crists grandstanding against them last year when they ask for a rate increase.
“glad i don’t live in FL, i’d be suing someone!”
Typical comment from an out of Stater not possessing all the facts.
The company owners are making a lot of profit but then crying poor to raise rates. They go out of their way to create companies to “manage” them. They own these same companies. I can take money from my left pocket, move it to my right pocket and then walk in to the rate increase approval and show them how empty my left pocket is and I need more money to fill it. I can blame mitigation or sinkholes but in reality I am still trying to hide my profits from the public so they don’t think to harshly of me. There is nothing wrong with a profit but you have to wonder/think about why the companies hide what they are doing with their profits. If the average person knew this was going….
first of all, i used to live in FL… problem, like many of you have said in many entries regarding the status of FLORIDA, is the governor has no clue! he does not understand the insurance, but yet, allows the insurance commissioner to raise rates for the florida casualty. they are still trying to recover the losses from back in 2005 and that is why they have added hurricane cat fund, but why should new policies have to pay that so the past can get paid? it’s a fishy statement.
This is typical whenever a newspaper tries to write an article relating to insurance rates. They almost always try to make the insurance company an evil entity.
The state owns Citizens and it doesn’t have a management company. The state did an actuary review of the rates a year ago and it was found that the rates were 60% of where they should be for Citizens to be actuarially sound. This is the direct result of the governor and other politicians messing with the rates.
Second, the management company provides a service for the insurance company and gets paid for it. If the management company did not exist, the insurance company would have to hire claims staff, adjusters, … to perform the jobs the management company is performing.
It is not as EVIL as the newspaper would like you to think. They should do better research.
The real reason behind the management companies is that when you start an insurance company, Florida restricts investment profits being paid to the investors who are looking for a return for 5 years. There is no such restricition on the management company.
I think the issue is transparency. Whenever anyone questions an insurer’s profits, some people immediately interpret that to mean they don’t believe insurers should make a profit. That’s not always true. It’s not whether the management company deserves money, it’s how much. And it is naive to think that there aren’t at least a few insurers playing games with this set-up and trying to have it both ways. Not all, but some.
If I remember properly, the pup companies were set up to avoid the rediculous surcharges in FL for property. The companies avoided surcharges on all of their business by writing FL coverage in FL only companies. Not trying to hide profit, just avoiding stupid government regulations.
OK. This is now the topic of “the consumer” that will never end. As an independent broker outside of Florida, however in a coastal state I also see this first hand. The average consumer doesn’t understand the insurance business, reinsurance, or the risk that is assumed on coastal property. The continued growth in coastal areas, and the inevitable hurricane risk has done nothing but grow, grow and grow larger. 20 years ago it was basically unheard of for hotels and resorts to be insured for 25-100 million. Nowadays this is pretty much the standard, not just 1 but the beaches are lined up with them. Why? You ask? Because, everyone wants warmer weather for secondary homes, vacation destinations, and retirement locations. Companies are in business to earn profit, when living in these areas expect to pay higher premiums today and in the future. This has become something that will continue to exist and goverment regulation will NOT accomplish it.
If homeowners or business want to see lower rates, the state should allow the market to be opened to everyone. At the beginning rates will be high but when the risk is spread out among companies, rates will be more competitive and Citizens will be the last resort for insurance. For now, Citizens is the major insurer in the state, Amazing isn’t?
The issue at hand is, yes they are making a profit, but is the profit enough? The companies need to charge enough to pay their “bills” and have a large surplus to cover that big storm WHEN it comes. Right now the rates they charge are not enough, which is why the large insurers have left, and are leaving the state.
well, obviously citizens it’s never going to be enough because they had to ask the state to create a hurrican catastrophe fund. not only that, citizens (as a last resort) had been operating at a lower expense because it was supposed to be the last line of defense for insurance. but now that it’s having to pay out, they find themselves in the red and had to request an increase in rates, but because they are so far behind they will have to make several increases overs years to catch up. so what will happen when the next major storm hits? it will probably wipe out citizens! most companies already have a cat fund ready to go. paying their bills comes under the general expenses so that should have been figured into the profit margin. hiding is not!