Insurance rates from Hell

"Yes Sir, You heard right Sir, Your insurance rate is going up 127.8 percent this Year"
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Citizens Property Insurance OKs rate hike

JACKSONVILLE, Fla. -- Dec. 16, 2005 -- The board of Citizens Property Insurance Corp. unanimously approved Thursday an average statewide rate hike of 44 percent for homeowners in high-risk areas, putting aside a state senator's request that it be delayed until an audit of the company is completed in February.



The increase, which must be approved by the state Office of Insurance Regulation, is on top of a 16.2 percent increase in high-risk coastal areas that was approved last February. The regulation office's board may have public hearings in some areas of the state with large increases.



The increases don't factor in damages of up to $1 billion from Hurricane Wilma, which may force yet another round of price increases for Citizens, said Justin Glover, a company spokesman. The government-created company is the state's insurer of last resort, selling property and windstorm policies to property owners who can't get it from traditional insurers.



The increases approved Thursday will add about $1,028 to the average homeowner's insurance cost for a total average of $3,363.



Residents in Escambia County face the biggest increases, including a 127.8 percent hike, and some residents in Charlotte, Lee and Santa Rosa counties will see increases above 70 percent.



The smallest hikes will be in Pasco County at 1.8 percent; Indian River County at 10.5 percent and Hernando County at 19.5 percent.



By law, Citizens has to have actuarially sound rates and new rates were implemented to meet those requirements. It also, by law, must have the highest rates in the state so it doesn't compete with traditional companies. It covers about 800,000 property owners.



Sen. Ron Klein, D-Boca Raton, asked the company's Board of Governors to delay its vote on a rate increase until the audit by the state is complete to determine "whether the hikes are justified."



Board Chairman Bruce Douglas said he was sensitive to the effect of rate increases on homeowners, but said the board was bound by state laws to remain on firm financial footing after a spate of devastating hurricanes over the past two years.



"We are dealing with a statewide problem," Douglas said, adding that Louisiana, Alabama and Mississippi also have had massive hurricane damage. "We have less of problem because we were better prepared," he said.



On the Net:

Citizens Property Insurance Corp.: http://www.citizensfla.org



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