Citizens Insurance Seeks Major Rate Increase And Flood Insurance Requirement

BY: ANDREW COLTON | Editor and Publisher

BOCA RATON, FL (BocaNewsNow.com) (Copyright © 2024 MetroDesk Media, LLC) — If your property insurance is through “Citizens Insurance” in Florida, get ready for a major rate hike. The Insurance Corporation Board of Governors approved a ”request” for an average 14-percent hike. The Board also approved a new mandate: all customers insured by Citizens will be required to carry flood insurance. The net result: Citizens customers could have to shell out hundreds of dollars — if not more — on top what they already pay.

This is the official statement from Citizens. We note that Florida’s Office of Insurance Regulation must approve the hike.

”Homeowner multiperil (HO-3) policy rates would increase by an average of 13.5%. Condominium owners would see an average 14.2% increase. If approved by the Office of Insurance Regulation (OIR), the rates would go into effect for renewal policies after January 1, 2025.

SB 2-A, which was passed by the Florida Legislature in December 2022, has had a material impact on Citizens’ rate need. For example, for the 2025 HO-3/HW-2 proposed rates, the impact has lowered the uncapped rate need by 38%. 

Citizens is required by law to charge actuarially sound rates that are not competitive with the private market while complying with the statutory glide path. The glide path caps individual rate increases at 14% in 2025 for primary residences, excluding coverage changes and surcharges. Rate increases for nonprimary residences can increase by up to 50%, excluding coverage changes and surcharges. 

Importantly, an analysis of Personal Lines rates found Citizens’ premiums remain well below the filed and approved rates of most private insurance companies writing in the state. This has been taken into account in developing the proposed capped rate indications.”

Citizens insures more than one million people in Florida.