Citizens Property Insurance proposed a statewide average rate hike of 25 percent for residential policies and 12 percent for policies that only cover windstorm.
The 25 percent increase is largely driven by massive rate hikes for sinkhole coverage, which would not affect renters and condo unit owners.
The Office of Insurance Regulation, which has the final say on the increase, announced Thursday that it has received state-backed Citizens' rate requests. Regulators indicated they'll hold the insurer to a requirement that it offset some of the proposed increase with savings expected from a sweeping new property insurance law that should lower sinkhole claims costs.
“They did not contemplate...the anticipated cost savings generated by passage of the new legislation,” Florida Insurance Commissioner Kevin McCarty told Cabinet members this week. If the rate increase is still significant, McCarty said the insurer could implement it over a few years as some private companies have done.
State law caps the annual premium increase for Citizens policyholders at 10 percent, but that excludes coverage changes, surcharges and sinkhole coverage. Citizens has proposed a statewide rate hike of 429 percent for the sinkhole portion of its rates.
Sinkhole coverage only makes up a portion of the premium for a homeowner's multi-peril policy, bumping up the overall average rate hike to 27 percent.
Most of Florida will not be hit as hard as the Tampa area, which could see average regional rate hikes of up to 195 percent, including the cost of sinkhole coverage, for homeowners’ multiperil policies, according to Citizens' request. The average proposed increases for parts of South Florida and Orlando area are up to 13 percent and 15 percent, respectively.
The proposed rate hike for Citizens' windstorm-only policies, which don't cover sinkholes, is 12 percent on a statewide average basis. Renters and condo unit owners' policies also don't include sinkhole coverage and the proposed increase is 4 percent and 9 percent, respectively.
The increase for individual policyholders can vary from statewide or regional averages.
The insurance regulation office plans to hold hearing on the rate hike but has not yet scheduled a date. Consumers who want to weigh in on the rate hike can email comments to with "Citizens" in the subject line.
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