TALLAHASSEE — The state’s insurance regulators on Monday allowed Citizens Property Insurance Corp. to charge an estimated average rate increase of 6.3 percent, down 1.6 percent from the original request.
The Florida Office of Insurance Regulation calculated Citizens’ average requested increases at 7.9 percent statewide.
More specifically, homeowners who don’t live near the water were facing an average 7.3 percent hike; now it’s estimated at 4.4 percent.
“We are grateful to OIR for its diligence in reviewing Citizens 2014 rates and pleased that it has agreed with our overall approach,” Citizens CEO Barry Gilway said.
“The agency’s action will allow Citizens to continue providing quality service to our 1.2 million policyholders while reducing the risk of assessments on all Floridians,” he added.
Exactly how much more individual homeowners in the Tampa Bay area will pay isn’t yet known because final analyses aren’t complete and aren’t yet broken down by county. Citizens has 270,000 customers in Hillsborough, Pinellas and Pasco counties.
New homeowners and fire insurance rates go into effect Jan. 1 for inland residents and Feb. 1 for coastal customers.
“It sounds like a win to me,” said Sean Shaw, a Tampa lawyer and former state insurance consumer advocate.
Citizens also recently announced a policy-comparison “clearinghouse” in which consumers can shop for comparable offers of coverage from participating private-market carriers.
Between the clearinghouse and lower-than-expected rate increases, “I think we’ll see the beginnings of a process to get Citizens under control,” Shaw said. “We have to do that by not kicking people out into worse and more expensive policies.”
Gov. Rick Scott earlier this year signed into law a measure that mandated the clearinghouse as a way to reduce the number of Citizens’ homeowner policyholders.
Scott and lawmakers have said Citizens needs to shrink, worrying it won’t be able to cover claims when the next big hurricane makes landfall.
The Citizens board also approved a deal potentially worth more than $50 million to transfer up to 60,000 policies to Heritage Property Insurance and Casualty. That company, which went into business last year, donated $110,000 to a political committee that Scott controls.
Other rates approved Monday went higher than Citizens’ request. Coastal homeowners with wind damage-only insurance now will pay 10.5 percent more on average. Citizens asked for 9.8 percent.
Some of the numbers are above the statutory 10-percent cap on Citizens’ rate increases because they include allowances for sinkhole coverage and charges to build cash reserves.
That cap is part of a property insurance bill passed in 2011 that promised to reduce costs for the state’s insurance market.
Regulators also approved hikes of 20 percent for sinkhole insurance for Hernando and Pasco counties and 50 percent for Hillsborough County, but they are supposed to be phased in over a number of years.