Higher rates anticipated in Florida home insurance market
Home insurance rates have been too low for too long, Florida insurers say
Even after a year without hurricanes, home insurance companies in Florida are reporting that they’re on shaky financial footing.
As a result, says the Naples Daily News, insurers that offer policies in the Sunshine State are planning to hike rates and decrease their risk exposure.
One major insurer already announced that it will not be renewing the home insurance policies of 60,000 Floridians. And another company has threatened to pull out of Florida completely if state regulators don’t allow it to raise rates to “actuarially sound” levels.
A big problem, say private insurance companies, is Citizens Property Insurance Corp., the state-run insurer for homeowners who cannot afford private policies. Private firms claim that Citizens’ rates are too low, hurting the competition that is vital to a healthy insurance market. But Citizens has indicated that it will raise rates in the near future; state lawmakers are allowing the company to increase rates by up to 10 percent annually.
“There seems to be growing support for making it easier for well-capitalized [home insurance] companies to do business in this state,” State Senator Garrett Richter, a Republican from Naples, said to the Daily News.
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Posted: November 30, 2009
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