Citizens moves forward with 11% rate hike
To keep up with the latest local news subscribe to our TV20 newsletter HERE and receive news straight to your email every morning.
TALLAHASSEE, Fla. (CAP NEWS/WCJB ) - The 52 private insurance companies writing policies in Florida lost a total of $847 million through the end of September, causing them to raise rates by 50% or more.
That is forcing homeowners into Citizens Property Insurance Corporation, the state’s insurer of last resort, but if the state approves, those already in Citizens will also see double-digit rate hikes.
With a Monday vote, Citizens moved forward with across the board rate hikes of 11% for anyone who renews after August 1, 2022.
Citizens would then raise rates 12% across the board for renewals after January 1, 2023.
“The private carriers are non-renewing policies across the state. They are raising rates, high rates,” said Michael Peltier, a Citizens spokesperson.
Peltier told us lawsuits are driving the increases.
“Florida represents about 8% of the property insurance market across the country. However, at this time, we represent about 76% of all lawsuits relating to property insurance,” said Peltier.
Even with the hikes, Citizens’ own study shows it’s the cheapest alternative 97% of the time.
Legislative changes earlier this year require a homeowner to accept a private insurer as long as it is no more than 20% higher than Citizens’ rates.
TRENDING STORY: Student loan payments will soon restart for millions
But even with the new criteria, Citizens’ policies are mushrooming.
“Since January, Citizens’ policy count has risen about 38%,” said Peltier.
Under the legislation passed earlier this year, rate hikes can grow 1% a year, up to 15% across the board in 2026.
“Trying to do what they can to bring Citizens rates more in line with what the private market charges,” said Peltier.
And the 11% and 12% hikes approved by the Citizens Board for next year and the year after must still get the okay from the state’s Office of Insurance Regulation.
Lawmakers are expected to make tweaks to insurance regulations when they meet in January, but any changes could likely take a year or two before consumers see any relief from rising costs.
Copyright 2021 WCJB Florida Partners. All rights reserved. Click here to subscribe to our newsletter.