ST. PETERSBURG, Fla. — As Floridians are dealing with the ongoing issues with the property insurance crisis, the state-backed "last resort" home insurance option is looking for approval to increase how much people will need to pay for coverage.
On Thursday, Citizens Property Insurance Corporation sat before the Florida Office of Insurance Regulation (OIR) for a public rate hearing. At the meeting Thursday afternoon in Tallahassee, the corporations' top brass advocated raising rates at the maximum increase allowed under state law.
CEO Tim Cerio says the number of Citizens policyholders has ballooned over the past two years, surpassing 1.3 million. Cerio says raising rates will help keep them afloat and bring competition back to the whole market, adding that Citizens has had "artificially low" rates.
Citizens is proposing more than a dozen rate changes for its various policies. Those range from a rate increase of 7.7% to 24.2%. If those rate changes are approved, they would take effect on Nov. 1 for new and renewed policies.
To see how much your rate may raise, click here.
Cerio also urged patience as they wait for recent legislative reforms to continue to impact the market, which has been damaged by frivolous lawsuits and growing reinsurance rates.
The public can give feedback on the proposed rates to the OIR and Citizens by June 22.
Citizens is supposed to be a last resort option for home insurance. But it's been one many Floridians have turned to since last hurricane season.
Days before this year's hurricane season began, insurance experts were urging Floridians to financially prepare, while understanding that many people don't have a lot of options.
“It’s a very difficult situation, we understand it. Unfortunately, we’re not seeing any relief in the near future for Florida homeowners,” Mark Friedlander with the Insurance Information Institute said in a recent interview. “While there's been a lot of reforms put in place in recent months, passed by the state legislature, all very positive actions taken by the legislature, it takes time for those reforms to show positive trends in the marketplace."
As the state-backed Citizens is approaching a record number of policyholders, Friedlander says it indicates people are having trouble simply finding coverage.
And costs will likely only go up from here. June 1 marked a reinsurance renewal period for many insurers, and experts anticipated spiking costs for companies that will then be handed down to consumers, such as the rate hikes proposed by Citizens. Though 14% is likely a lot less than what other private insurers will soon increase by.
The Department of Financial Services has resources available for people looking to find home insurance coverage or get help with questions regarding their existing coverage. The hotline can be reached at 1-877-MY-FL-CFO (693-5236).