Velocity / National Specialty Insurance Company seeks 28.1% rate hike for Florida homeowners
Despite major assignment of benefits (AOB) reform earlier in the year, a major insurance carrier is seeking a more than 28 percent rate increase on Florida homeowners policies.
The majority of State National Insurance Company, the parent entity for National Specialty Insurance Company (National Specialty), filings this month were related to rates, particularly for auto and garage coverage, according to a search of the Florida Office of Insurance Regulation's online database. The company's rate-related Nov. 6 filing for homeowners "multi-peril" coverage in Florida remains open, according to the database.
If approved, the effective date for National Specialty’s increase would be Feb. 7 for new business and March 23 for renewals.
Florida residents can expect other insurance companies to file rate increases, too.
Of 20 non-zero filings effective in the past six months that included a rate indication, 80 percent were positive – meaning a rate increase is requested – and 55 percent were asking for increases in double digits.
The majority of these filings were submitted before changes in reinsurance pricing came through. About 500,000 policyholders were affected. A number of filings after the reinsurance placements are currently pending review by regulators.
Other insurance carriers requested (and received) rate increases that went into effect earlier this year. Florida Specialty Insurance Company's 14.80 percent rate increase on new business, effective June 28, affected more than 2,300 policyholders while Heritage Property & Casualty Insurance Company's 13.40 percent increase on new business, effective Aug. 1, affected nearly 82,000 policyholders.
Electric Insurance Company's almost 11 percent increase on new business, effective June 27, impacted more than 1,700 policyholders, while Centauri Specialty Insurance Company's more than 10 percent increase on new business, effective July. 1, affected nearly 38,000 policyholders.
While recent legislation in Florida regarding assignment of benefits has helped address rate inadequacy, many carriers still have large rate indications – the premium increase that needs to be taken to turn a profit – which shows that there is more pressure for carriers to increase rates. Due to recent hurricanes, some carriers have seen their reinsurance (insurance for insurance carriers) prices increase, which will continue to drive rates upward for consumers in the state of Florida.
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