Citizens’ Board approves revised 2019 rates reflecting AOB reforms
June 19, 2019 - Maitland
Citizens Property Insurance Corporation’s Board of Governors on Wednesday approved 2019 proposed rates that reflect recent legislative changes to reduce unnecessary litigation and assignment of benefit abuse that have driven up rates for the past several years.
By unanimous vote, the board approved a statewide average capped increase of 2.3 percent for homeowners multiperil policyholders, compared to 8.5 percent increases which was the recommended capped rate increase approved in December 2018 that did not reflect the passage of HB 7065.
Taking the changes into account, nearly 44,000 additional homeowners, condo unit owners, dwelling and mobile homeowners policyholders will see rate decreases with a total of more than 67,000 seeing decreases for 2019. Many others will see less significant rate increases.
“Today’s recommendation is a direct result of meaningful legislative reforms passed earlier this year to combat rising premiums that have placed an increasingly heavy burden on our policyholders,” said Gary Aubuchon, Interim Chairman of Citizens Board of Governors.
Citizens is required by state law to submit a slate of actuarially sound rates to the Office of Insurance Regulation annually for approval. If approved, the 2019 rates begin taking effect December 1, 2019, for new and renewal policies.
The passage of HB 7065 caps a multi-year effort to address runaway litigation and AOB abuse, especially surrounding nonweather related water loss claims, which after decades of stability skyrocketed in recent years.
“This would not have been possible without the leadership of Governor Ron DeSantis, Chief Financial Officer Jimmy Patronis, Senate President Bill Galvano and House Speaker Jose Oliva, said Barry Gilway, Citizens’ President/CEO and Executive Director.
The new law provides additional safeguards for policyholders who change their minds or are unsatisfied with the work after signing an AOB, and more clearly defines the responsibility of vendors and insurers when assignments are in place. Finally, the law provides incentives for all parties to make reasonable settlement offers following a loss.Citizens has prepared a 2019 rate kit to provide members of the media with information about its 2019 rate filing, including county-by-county estimates for particular policy types. Additional information and answers to common questions about Citizens' rates and premiums are included in Citizens 2019 Rates Frequently Asked Questions. The kit also includes additional information about Citizens' costs and projected rate need for 2019.
In 2002, the Florida Legislature created Citizens Property Insurance Corporation (Citizens), a
not-for-profit alternative insurer, whose public purpose is to provide insurance to, and serve the needs of, property owners who cannot find coverage in the private insurance market.