The Florida Office of Insurance Regulation has approved an 8.3% statewide average rate increase to condominium association policies in Citizens Property Insurance Corp.'s commercial residential account, according to state records.The condominium association account is the largest commercial lines account for which the insurer of last resort sought a rate increase, according to information from the OIR. The change will impact 30,025 policies in that line, which has earned premium of $157.2 million. It will be effective for new and renewal business on Jun. 1, 2014.
Florida regulators are still considering rate increase requests to Citizens personal and coastal accounts. Those two accounts have a significantly greater policy count and premium intake than the commercial accounts. Citizens officials gave an Aug. 20 presentation to state regulators to make their case for 6.6% overall average homeowners rate increase (Best's News Service, Aug. 21, 2013).
Also approved by regulators was an 8.6% average overall rate increase for Citizens' commercial nonresidential policies. That account has 2,654 policies and earned premium of $9.2 million. Citizens and the OIR left rates unchanged for commercial residential account policies that are not condominium policies, records say.
The rate process for Citizens differs from other insurance companies because Citizens files rate recommendations to the OIR, which then establishes a rate, according to the OIR. Other insurance companies file rates for approval for disapproval.
Citizens in 2012 was Florida's largest writer of homeowners insurance, with 19.53% of the market. The company in 2012 reported overall direct premiums written of $3.2 billion and a statutory net underwriting income of $611.9 million. Its surplus at the end of 2012 was $6.2 billion, which is its highest level in at least the past five years. In his rate presentation to regulators, Citizens Actuarial Research Manager Paul Kutter said the company was in its best position ever to pay claims following a major hurricane.