NU Online News Service, July 20, 4:00 p.m. EDT
Florida's last-resort insurer is looking to ask regulators for an average statewide rate increase of 10.4 percent for personal residential multiperil and wind-only policies combined in 2011.
Including rates sought for renters, condominium owners and mobile homes, Citizens will be seeking a 9.4 percent for multiperil policies and wind-only policies combined, according to a report the state-run insurer prepared for review by its board next week.
Citizens Property Insurance Corp. in 2009 was given the go-ahead by law to begin increasing rates in order to become more actuarially sound, but premium increases are capped at 10 percent per policyholder to lessen the impact on its more than 1.1 million policyholders in force as of the end of June.
Without the cap, Citizens said it would be seeking an average rate increase statewide of 58 percent for multiperil and wind-only policies.
Prior to the 2009 law, Citizens' rates had been frozen for three years.
According to an executive summary from a July 19 Citizens committee meeting, actuaries included non-catastrophe losses and sinkhole losses into the rates.
In modeling for personal residential policies, Citizens used software from AIR Worldwide. A version of the model was approved by the Florida Commission on Hurricane Loss Projection Methodology in June, the report states.
Last year Citizens used a model from Risk Management Solutions, said spokeswoman Christine Turner Ashburn. For most lines there was a close correlation between the models, but for commercial residential multiperil the models differed greatly. AIR suggested a rate decrease of 6.6 percent while RMS indicated a 12.5 percent increase. Ms. Ashburn said Citizens settled on no increase for this line.
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