The Florida Office of Insurance Regulation has approved an average rate hike of 18.8 percent for Florida homeowners covered by State Farm.
In a statement, Florida Insurance Commissioner Kevin McCarty said, "The amended rate filings by State Farm accepted by the Office today are reflective of both a rate need by the company as well as cost-drivers in the system. State Farm provided actuarial support for these new rates through data submitted in their amended rate filing, and through responses to Office questions during the public hearings conducted on February 15 in Tallahassee."
The insurer submitted two rate filings in December.
One filing (No. 10-21378) asked for a rate hike effect of 27.9 percent, impacting 570,423 policies for dwellings (homeowners-HO3), tenants (HO4), and condo unit owners (HO6). In those areas, the filed increase percentages and final accepted percentages are: HO3, a filed increase of 28.4 percent, accepted effect increase of 20.0 percent; HO4, a filed increase of 5.8 percent increase, accepted effect decrease of 15.0 percent; HO6, a filed increase of 19.3 percent increase, accepted effect decrease of 3.0 percent.
State Farm's filing No. 10-21380 involved commercial-multi peril residential, where the property owner is not the occupant. The initial filed rate effect was a 95.7 percent increase, impacting 40,137 policies. The final accepted rate effect is a 62.1 percent increase.
The approved rate hikes for all coverages will take effect June 1 for new business and July 15 for renewal business.
The rate hikes come in the midst of a contentious property insurance battle at Florida's legislative session. Lawmakers are debating several property-related bills that will impact State Farm, its competitors, and Florida's largest property insurer, the state-mandated Citizens Property Insurance Corp. Under discussion are sinkhole coverage requirements, changes regarding how much an insurer has to pay out for damages to a home and personal contents, time limits on homeowner claims, the process for future rate hikes, constraints on public adjusters, and major changes at Citizens in terms of eligibility requirements and rates.
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