ST. PETERSBURG, Fla. — More than a million Florida homeowners could see an increase in property insurance costs again next year. The question is how much exactly they’ll go up.
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The state-backed Citizens Property Insurance is requesting a roughly 14% rate increase for next year, their largest statewide requested increase on record. Leaders at the company say their rates are still artificially low and not actuarily sound.
“We certainly do not take our request for a rate increase lightly,” Citizens CEO Tim Cerio said at a hearing earlier this month. “Our rates for the most part remain actuarily unsound and highly competitive across the state and as a government-backed insurer of last resort we should never be competing with private market.”
From $2,954 to $3,234 in Pinellas (13.3%)
From $2,667 to $3,208 in Hillsborough (13.5%)
From $2,972 to $3,370 in Sarasota (13.4%)
The request still has to be approved by regulators in the Office of Insurance Regulation. Many, including staff, expected an order to be posted on Monday, but that has not happened yet.
“Pursuant to s. 627.062, F.S., OIR has to issue a final order establishing Citizens’ rates within 45 days after the last recommended rate is filed. We are anticipating the final order to be published sometime [Monday],” the office told 10 Tampa Bay.
According to online records, the last recommended rate filing from Citizens came on July 12. We reached out for further clarification on when an order may come and are waiting to hear back.
“The state regulator needs to carefully assess the data provided by the company as well as input received from customers during the public comment period. There are two likely scenarios: the regulator will ask Citizens to revise its data or approve the rate request as is,” Mark Friedlander with the Insurance Information Institute said.
Meantime, industry experts like Friedlander say a Citizens rate increase is necessary as the company looks to shed its overall policy count and limit risk to policyholders of all kinds across the state.
Friedlander says the private market is showing signs of improvement and legislative reforms are starting to have a a positive impact.
“Citizens is seeking this increase because its average rates are well below the private market and it continues to grow at several thousand new customers a week. Citizens wants to disincentivize consumers from choosing it over a private insurer based on price,” said Friedlander.
Right now Florida homeowners are eligible for Citizens coverage if they do not receive a policy offer from a private insurer within 20% of the overall cost.
“It is intended as the state’s insurer of last resort and should not be competing with private insurers. The company’s ultimate goal is depopulation to a manageable level of risk (about 400,000 to 500,000 customers).”
Regardless of what order comes from OIR, rate increases would go into effect for new policies and renewals after January 2025.