Florida’s state-backed property insurer’s proposed rate reduction is raising questions about whether it will make the insurer competitive with the private market.

Citizens Property Insurance Corp. recently proposed 2015 rates that include a statewide average 2.9 percent rate decrease on all residential policyholders.

If approved by regulators, seven in 10 Citizens personal lines policyholders will see a rate reduction next year. Th statewide average homeowners’ premium would drop from $2,538 to $2,379.

Not everyone, however, is greeting the proposed rate cut as good news.

Florida Property and Casualty Association Executive Director William Stander said he has heard rumblings through the industry over what the rate cut could mean for insurers’ expansion plans.

“I have heard some concerns among companies that Citizens’ rate trajectory potentially could interfere with their depopulation efforts,” said Stander.

Florida Association of Insurance Agents President Jeff Grady said that rate changes pitted what actuaries might calculate against public policy decisions. But just as a matter of perception, he said, any rate cut raises questions.

“It does seem to depart from the insurer of last resort having the highest rates,” Grady said.

As to the matter of competition, the state Office of Insurance Regulation approved 43 

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http://www.insurancejournal.com/news/southeast/2014/07/22/335477.htm

Florida’s passage of a homeowners’ claims bill of rights left few satisfied after lawmakers largely codified current law while avoiding controversial issues such as the practice of policyholders assigning their claims payments to contractors.

The bill of rights was a priority of the state’s Chief Financial Officer Jeff Atwater and was initially drafted by the state’s insurance consumer advocate’s office.

Atwater said the bill is needed given that about 350,000 homeowners file claims each year and his office receives 125,000 calls from policyholders either filing complaints or searching for answers about their claims.

“This much-needed bill of rights will notify Florida homeowners of their rights and responsibilities when filing an insurance claim and give them confidence that they will be treated fairly during a stressful situation involving their home,” stated Atwater.

The 12-point bill of rights is meant to inform homeowners of timelines such as one requiring insurance companies to acknowledge a claim within 14 days of being filed. Additionally, insurers must within 30 days of receiving a proof-of-loss statement, confirm a claim is covered, partially covered or denied. Within 90 days, insurers must either pay the claim in full or in part or deny the claim.

The bill of rights also advises policyholders what they need to do in case they have property damage, including that they should contact their insurer before hiring a contractor.

While Atwater and his allies have been declaring victory, some who participated in crafting the bill walked away disappointed in an outcome that created no new legal rights for homeowners or insurers.

What seemed at first a rather non-controversial piece of legislation turned into a heated debate over a so-called “assignment of benefits” provision.

Under this provision, homeowners can sign over their financial rights to be paid for a claim so that instead the payments are made directly to a contractor making repairs instead of to the homeowner.

The contractor also assumes the policyholder’s legal right to dispute a claim and file suit against an insurer. If the contractor prevails in court, in addition to the insurer having to pay the claim, it must also pay the contractor’s legal bills.

From insurers’ point of view, this has created a cottage industry where trial lawyers and contractors work to maximize the monies they can receive from insurers regardless of the real cost of the claim.

Personal Insurance Federation of Florida Executive Director Michael Carlson said that is a major reason his association supported doing away with the assignment of benefits.

“What we are seeing under assigned benefits is unscrupulous contractors who tell homeowners that in order to get repairs they have to sign a form signing away their rights,” said Carlson. “Then the vendor will inflate the claims costs then tell the insurer you owe us this much or we will sue you.”

Carlson said that in addition to increasing claims costs and unnecessary litigation, the assignment of benefits practice keeps consumers in the dark about their own claims. For example, he said, policyholders have had lawsuits filed on their behalf without their knowledge.

 

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http://www.insurancejournal.com/news/southeast/2014/06/23/332627.htm

 

Florida Gov. Rick Scott has signed legislation designed to encourage private insurers to offer flood insurance, but the industry is tamping down expectations that it will result in a viable market in the near future.

The legislation creates a statutory framework allowing private insurers to offer four different types of flood coverage ranging from standard coverage, which mirrors the current National Flood Insurance Program policies, to three other enhanced coverages.

The legislation also allows private insurers to file their own rates prior to October 1, 2019, after which they must be approved by regulators. The time period is so Florida insurers can develop state flood data that is currently not available under the NFIP.

Florida Insurance Commissioner Kevin McCarty says it will ultimately benefit consumers.

Biggert-Waters Debate

Lawmakers first pursued the flood insurance bill with a sense of urgency in response to the federal Biggert-Waters Insurance Reform act of 2012, which was designed to address a $24 billion funding shortfall in the National Flood Insurance Program caused largely by hurricanes Katrina and Sandy.

Biggert-Waters required some flood premiums to rise, in some cases substantially, until they attained actuarial levels and for most subsidies to be phased out. It also called for new flood maps that also raised some premiums and expanded flood zone areas so that more people had to buy coverage.

Eliminating long-time premium subsidies on homes built before 1974 and keeping property owners from pass along those subsidies when they sold their homes meant that 280,000 Florida homeowners faced rate increases and other confronted difficulties selling their homes.

More than two million Florida residents are covered through the NFIP, and state’s policyholders pay $3.60 in premiums for every $1 in claims, factors some say favor the creation of a private market.

However, after there was a public uproar over the Biggert-Waters changes, Congress amended that reform law to limit rate increases, retain premium subsidies and allow subsidies to pass through to new owners when a house is sold. As a result he urgency over the need for a private market waned.

 

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http://www.insurancejournal.com/news/southeast/2014/06/17/332214.htm

The Florida House has rejected a proposal that could shift homeowners away from the state-backed Citizens Property Insurance and into private surplus lines insurers.

Rep. John Wood, R-Winter Haven, said that the issue was dead for this year’s session.

Lawmakers have taken several steps over the last few years to try to steer people away from the state-created Citizens. Citizens was set up initially to be an insurer of last resort but it grew as Florida was hit by hurricanes and private insurers sought to limit their exposure in the Sunshine State.

Last year, legislators approved creating a clearinghouse that requires insurance agents to look at offers from private insurers before allowing someone to purchase a Citizens policy. A customer is ineligible for Citizens if one of the insurers charges premiums that are within 15 percent of Citizens rates.

The Senate bill as originally passed would have added surplus line insurers to those that could be offered through the clearinghouse starting in January.

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http://www.insurancejournal.com/news/southeast/2014/04/30/327963.htm

the push by Jeff Atwater is in serious jeopardy. That’s because insurers, such as State Farm Florida, are only willing to accept the added protections if they come with other changes that could help keep their costs down.

The bill would create a “homeowner claims bill of rights” that requires insurers to spell out to homeowners what they can expect when they file a claim.

The legislation also would prohibit insurance companies from using credit information to deny a claim or cancel a policy if the policy has been in effect for more than 90 days. This provision came out of a dispute between regulators and one of Florida’s largest insurance companies.

Atwater said that the Legislature has given consumers specific rights over the years, “but consumers don’t have a bookshelf at home with these statutes. They are not conversant in this.”

But some insurers want a separate provision that would place limits on when a homeowner can sign over to a contractor the right to collect payments directly from an insurance company. They contend that this is a looming problem and that some companies hired to fix roofs and repair water damage have inflated the costs. Without the change the fear it is could drive up homeowner insurance rates once again.

Atwater initially backed this provision and said there are places where it is being abused. But the provision has drawn opposition from contractors and earlier this month a Senate panel voted to strip it out of the bill (SB 708).

Please call L & S Insurance at 1-888-244-7400 for quotes on Home, Flood, Auto, Business & Commercial and Life & Financial products as well. Please enjoy the full article below;

http://www.insurancejournal.com/news/southeast/2014/03/31/324820.htm

 

 

In response to Jeff Atwater the CFO of Florida, Kevin McCarty has finally decided to help Floridians and the Real estate market in General. Several Months ago I blogged about this issue raised by The CFO and now we finally have some positive answers. I have already seen some carriers reducing rates for the Spring so good things to look forward to as long as Hurricanes like Andrew, Katrina, Wilma & Sandi do not find their way to Florida. Please enjoy the full article below from the Insurance Journal. Please call L & S Insurance at 1-888-244-7400 for quotes on Home, Auto, Flood, Business & Commercial, and life Insurance products as well.

http://www.insurancejournal.com/news/southeast/2014/01/21/317685.htm

Reinsurance prices have dropped this year, but we are not seeing any relief with price decreases yet on Home Insurance, and our CFO is finally asking the question why. This has taken a while as prices are way above where they were after Hurricane Wilma and things have improved since then in many ways! The reason is simple!! No one has made them lower rates. They are following the requests of our Governor Rick Scott when he came into office saying the Insurance companies need to get fiscally healthy, but not many knew what that meant. Let’s see how this pans out as The people of Fort Lauderdale, and all of S. Florida need a rate hike break as it is killing the Real estate market as well. So many are struggling with budgets and Foreclosures are still everywhere so why does the Insurance rates have to be so high. I like the pressure from the CFO and it is long overdue! Please call L & S Insurance at 1-888-244-7400 for quotes on Home, Auto, Flood, Business & Commercial, and Life Insurance products as well. Please enjoy the full article below!

http://www.insurancejournal.com/news/southeast/2013/10/30/309783.htm

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