We have received many of the same calls recently; clients wanting to know why their insurance premiums are rising for their home owners insurance? We spent some time doing some specific research to find an answer other than "just because". Unfortunately the information is simply "disturbing". Below are listed just a couple of headlines regarding insurers in the state and what they are looking for.
February 15, 2011- State Farm Requests 28% Increase for home owners insurance impacting roughly 700,000 home owners in Florida.
April 16, 2011- State Farm Gets Some of It’s Requested Rate Increase. The Office of Insurance Regulations approved an 18.8% statewide increase for State Farm. As of June 1, 2011 State Farm has been granted a statewide increase which includes a 20% rate hike for their home owners insurance, a 15% decrease for renters insurance and a 3 % decrease for condo owners. Existing customers for State Farm will see this increase in premiums as of July 15th, 2011.
May 25, 2011- Fidelity National Property & Casualty requested regulators to allow a 27.6% increase affecting nearly 12,000 currently insured home owners. Steve Alexander, an actuary with the Florida Insurance Consumer Advocates Office proposed a 12% increase instead. “We did not receive much background as to why their claims or the severity of their claims are increasing.” Fidelity National Property & Casualty reported $17 million in losses to property insurance claims last year.
Jeff Harrington of the St. Petersburg Times posted a great article dated June 1, 2011 on the “Five Reasons That Florida Homeowners Insurance Is Still getting More Expensive. Jeff lists five reasons to expect property insurance rates to continue trending up. The reasons that are mentioned are 1- Natural Disasters other than hurricanes hit the reinsurance market hard. 2- New hurricane model opens the door to higher rates. 3- Friendly regulators and politicians 4- Citizens Property rate hikes and 5- Non hurricane costs.
The most disturbing information that I have found is a series of bills currently working their way through Florida’s Legislature. Senate Bill 408 specifically needs to be something that ALL Florida property owners are aware of. We are currently researching this bill and will pass along more information to you during our next blog. At Birchell Insurance Agency we are here for our clients. If you have any questions, please feel free to call 800-978-8813.