When a 41% Rate Increase is not Enough for Homeowners Insurance in Florida

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When Florida Farm Bureau Insurance companies filed for a 41% rate increase for homeowners last December, the Florida Office of Insurance Regulation asked company actuaries to sharpen their pencils, review all data and try again.

The insurer’s vice president said Tuesday that the company did just that – and ended up with an even larger rate request of 48.7%.

“We went back to the drawing board. We submitted a new version of the indications” and even threw in another quarter of loss data, Florida Farm Bureau’s Ben Kimmons said at an OIR rate hearing Tuesday afternoon.

The result of the re-review was that loss costs and loss development factors have only grown since 2021, thanks to an increase in the frequency and severity of wind claims, the growing impact of inflation on building material costs, a reinsurance price hike and litigation expenses. It’s the latest indicator of the challenges that property insurers are facing in the troubled Florida market.

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If the 48.7% rate increase is approved, the average spike in premium for Florida Farm Bureau’s HO-3 renewing policies would be about $1,200 annually. Florida Farm Bureau General Insurance Co. and Florida Farm Bureau Casualty Co. together reported 80,380 policies in force in Florida at the end of 2021.

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