California has imposed a higher-than-expected rate cut on Assurant's force-placed line of insurance business in the state, creating concern by an analyst that other states might follow suit and the profitability of the line nationwide may be substantially reduced.
In an announcement Monday, California Insurance Commissioner Dave Jones announced that Assurant had agreed to a 30.5 percent rate reduction, for "lender-placed" or force-placed homeowners-insurance coverage offered by American Security Insurance Company, an Assurant Inc.-owned company.
Jones estimates American Security's gross premiums from this line business to be $140 million in California in 2012.
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