Citizens Property Insurance Corporation’s Board of Governors recently approved a proposed 7.2% average rate hike for residential policyholders. The request was approved by a 7-2 vote, and it’s said the rate change will help the company be more competitive with private insurers. As a result, it will help slow the number of policyholders returning.
The proposed change is for a statewide average increase of 7.2% for all personal property policyholders. Homeowners would see an average increase of 6.1%, while condo and mobile home owners would see an average increase of 9.4%. Renters insurance rates would increase an average of 4%. Mobile home and dwelling policyholders would also incur rate increases.
If Citizens Insurance gets the rate hike approved by the Florida Office of Insurance Regulation, they would go into effect for any policies renewed after Aug.1, 2021.
Citizens Insurance cites several reasons for the proposed rate hike. The first being losses due to non-weather water claims. Other factors contributing to the rate increase include projected loss due to hurricanes and the rising cost of reinsurance.
Citizens Insurance has experienced an increase of almost 20% in the number of policies written over the last year jumping from 443,000 to 552,000. Why are so many Floridians flocking to Citizens?
To account for losses due to Hurricane Irma and Hurricane Michael as well as pricey litigation and reinsurance costs, private insurers have been raising their rates for Florida property owners.
Some property owners are also being dropped by their current homeowners insurance company. For some, their carrier has made changes in where they provide coverage or to their product line. Other homeowners may have been dropped due to changes in their claims history or their home no longer meeting underwriting guidelines.
If the proposed rate hike is approved by the state, homeowners will see varying rate changes depending on where they live in Florida. Citizens Insurance provided current and proposed average premiums by county for multi-peril homeowners policies.
Osceola and Union counties are at the top of the list with a recommended rate change average of 9.5%. Hamilton and Seminole counties are next with a 9.3% average rate increase, followed by Orange county and Duval coming in at 9.2% and 9.1% respectively.
In Duval county, Citizens cites the current average homeowners policy (HO-3) is $1,338. A 9.1% rate increase would drive that premium to $1,460.
Meanwhile, residents of Gulf county in the Florida’s panhandle may see an average rate increase of just 2.5%. However, residents in this area currently pay some of the highest premiums with the current average listed as $5,262.
Dade county is the largest in Florida. The current average premium for Citizens policyholders is $3,701. A recommended rate change of 4.9% would make the average to $3,882.
The national average homeowners insurance premium is $1,249, according to the National Association of Insurance Commissioners (NAIC).
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