Citizens Property Insurance pulls back on rate hikes
Citizens Property Insurance said it will scale back on rate increases after assignment of benefit legislation passed
In some rare good news for South Florida homeowners, the state’s property insurer said it will scale back on its previously planned rate hikes.
Citizens Property Insurance said it will only raise its average personal lines residential premium 4.7 percent in Florida, down from its proposed rate increase of 8.2 percent, according to the Miami Herald. The 8.2 percent rate hike was proposed in December.
In Broward County, 29,215 customers would see an average 9.6 percent increase — from $3,057 to $3,351. In Palm Beach County, 10,907 policyholders would see a 4 percent average increase — from $2,901 to $3,016. Miami-Dade County’s 55,2798 customers will see their rates decrease by an average of 3.5 percent.
The reduced rate hike is due to Gov. Ron DeSantis’ approval of an overhaul to a controversial industry practice known as assignment of benefits, according to the Herald.
Assignment of benefits deals with property owners who sign over benefits to contractors, who then go after payments from insurance companies. Insurance companies say the practice drives up costs and legal fees, while attorneys say the law ensures that claims are fully paid by thrifty insurers. DeSantis approved the legislation in April.
Under the previous bill, South Florida homeowners would see some of the biggest rate increases in the state. Rates for homeowners insurance would have increased 9.9 percent in Broward, 9.4 percent in Miami-Dade and 7.0 percent in Palm Beach County.
Citizens is referred to as the insurer of last resort, providing an option for people who can’t get insurance elsewhere. Nearly a decade ago the number of policyholders neared 1.5 million. But the state sought to push policyholders to private insurers to reduce the cost burden on the government. Citizens now has about 420,000 policies. [Miami Herald] — Keith Larsen