Florida Insurers Asked To Delay Rate Hikes

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By Steve Tuckey

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NU Online News Service, Feb. 14, 3:34 p.m.EDT?The Florida Office of Insurance Regulation has issueda memorandum asking insurers writing personal and commercialresidential coverages to refrain from implementing or seeking ratechanges until this year's legislative session ends.[@@]

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The Legislature is set to convene on March 8 and adjourn on May6.

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OIR's request for a hold on rates followed a Feb. 3 request tothat agency for a freeze from Florida Chief Financial Officer TomGallagher. Homeowners who suffered losses from the fourback-to-back hurricanes which hit the state last year "should notbe victimized a second time," announced Mr. Gallagher.

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"The market needs to stabilize and state lawmakers should havethe opportunity to act on recommendations for insurance reform thatwill help offset the need for rate increases," he said.

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Mr. Gallagher said he was making his request after hearing thatthe Office of Insurance Regulation had received a request fromColumbus, Ohio-based Nationwide for an average homeowners rateincrease of 28.3 percent.

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The OIR memo, dated Feb. 8, asks insurers who have submittedeither file and use rate filings, or use and file filings, to delayimplementation of any rates until 30 days after the legislativesession ends. The directive also asks insurers to refrain fromsubmitting any new rate filings until the legislative sessionends.

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According to the Florida Insurance Council, 31 companies havesubmitted rate filings since October 2004. Of that number, 13filings were approved while 14 are still pending and four wereeither denied or withdrawn. Rate filing requests have averagedbetween 5 and 10 percent.

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The memorandum notes that the OIR, with lawmakers and interestedparties, is currently exploring possible ways to expand thecapacity of the insurance market in order to improve both theavailability and affordability of insurance for residents.

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In a related event today, Florida Insurance Commissioner KevinMcCarty announced that 91 insurance companies were assessed finestotaling more than $1.1 million for filing late affidavits stemmingfrom Tropical Storm Bonnie and Hurricanes Charley, Frances, Ivanand Jeanne.

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The emergency rule they were found in violation of required allproperty and casualty insurers with direct personal linesresidential property claims in Florida resulting from the five 2004storms to expeditiously settle claims and furnish an affidavitattesting to their compliance with the emergency rule.

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