Citizens Board of Governors has approved recommended rates for 2017 that equal an average rate increase of nearly 7 percent statewide. The company said the increase is a necessary response to rising non-weather water losses and assignment of benefit (AOB) abuse that is now affecting all regions of the state.
By unanimous vote, board members recommended the 6.8 percent statewide increases for personal lines policyholders, reversing a recent trend of lower rates for all but South Florida customers. Citizens said in a statement that the increase reflects the negative effects the company is experiencing from water losses, AOB abuse and increased litigation that has begun to spread across the state. Citizens’ rate package now goes to the Florida Office of Insurance Regulation (OIR) for approval.
Under the proposed rates, inland homeowners with multiperil policies would see an average increase of 6.3 percent, while homeowners along the coast would see rates climb by an average of 8.6 percent. Rates for condominium unit owners would rise by a statewide average of 7.1 percent.
Multiperil HO3 policyholders in the tri-county area of Miami-Dade, Broward and Palm Beach counties, where water claims and AOB litigation have been the most rampant, will see rate increases of 9.1 percent, 8.9 percent and 9 percent, respectively. Statutorily, Citizens can only raise rates by up to 10 percent per year but has said that actuarially sound rate increases for this region should be as high as 189 percent.
