State approves Citizens Insurance rate hikes for Broward, Palm Beach
Despite insurance reforms which passed this past spring, Broward and Palm Beach County residents who are insured by Citizens Property Insurance Corp. will see their rates increase in December.
Weary of seemingly never-ending rate hikes, customers of stateowned Citizens Property Insurance Corp. in Broward and Palm Beach counties won’t be getting any relief soon.
On Monday, the state Office of Insurance Regulation approved an average 9.6% rate hike for the company’s 29,212 multiperil residential policyholders in Broward, effective on Dec. 1. Average premiums will increase from $3,057 to $3,351. Just four years ago in 2015, the average was $2,611.
Citizens’ 10,907 multiperil residential policyholders in Palm Beach County will get an average 4% rate hike and average premiums will rise from $2,901 to $3,016. Palm Beach County residents paid an average $2,419 in 2015.
The company’s 55,279 multiperil residential policyholders in Miami-Dade County will see their rates go down by 3.5%, with average premiums declining from $3,687 to $3,557. That’s significantly higher than 2015, when Miami-Dade policyholders paid an average $2,949.
Rates in Broward and Miami Dade are among the highest in the state, with average premiums trailing only those paid by homeowners in Monroe County, home to the Florida Keys.
In addition to being at high risk for hurricane damage, Broward and Miami-Dade have led the state in claims abuses and lawsuits by repair contractors and plaintiffs attorneys over the past decade.
Rising costs from those abuses were cited as justification for disproportionately high rate increases in Broward, Miami-Dade and Palm Beach counties in 2016 and 2017. Citizens officials said those increases would have been worse if the company was not barred by state law from increasing rates more than a statewide average of 10%.
The law forces Citizens to keep rates artificially low so the coverage won’t become too expensive for homeowners with no choice but to buy it.
Customers in Miami-Dade, where most of the abuses originate, saw premiums increase more than in Broward and Palm Beach during those years. So when the company in June rolled back proposed rates to reflect projected savings from reforms passed in May to curb the abuses, Miami-Dade policyholders benefited more, a Citizens spokeswoman said in June.
When originally proposed by Citizens before the Legislature passed reforms, rates were to have increased by 9.9% in Broward, 7% in Palm Beach and 9.4% in MiamiDade.
The 8.5% statewide increase originally proposed for multiperil residential customers was reduced to 2.6% after the reforms were enacted.
Once the largest carrier in the state by number of policies, Citizens has surrendered more than 1 million customers since 2012 to the private market, which typically can offer lower rates. But as the “insurer of last resort,” the company is required by law to provide coverage to homeowners who cannot otherwise obtain it from commercial insurers.