Paul
Published Wednesday, June 22, 2005
Allstate to seek rate increase from Florida homeowners
The Associated Press
TALLAHASSEE, Fla.
Allstate Floridian Insurance Co. told regulators Wednesday that it intends to raise homeowners rates by 28 percent, on average, starting immediately.
The company said it plans to file a rate request with state regulators in July but would begin increasing rates before actually filing, as allowed by law. If the increase isn't approved, it would have to be refunded.
"I want to reassure Florida policyholders that Allstate's filing will be thoroughly reviewed," said Florida Insurance Regulation Commissioner Kevin McCarty.
The planned filing, announced late Wednesday, is necessary because of the "increasingly expensive proposition" of covering storm costs in Florida, said Deb Clouser, a spokeswoman for Allstate Floridian.
"The increases are driven by the volatility of hurricane losses and the high cost of raising capital, including the purchase of private reinsurance, to make sure Allstate Floridian can pay the high cost of hurricane claims in 2005 and beyond," Clouser said.
Allstate officials said earlier this year that the company paid about $2 billion in claims after Hurricanes Charley, Frances, Ivan and Jeanne hit Florida last year.
Spokeswoman Valerie Beynon of the Florida Office of Insurance Regulation said the filing would cover about 640,000 policies, for homes and condo units and for the contents of rental units whose occupants have renter's insurance.
Lawmakers passed a measure this year that calls for public hearings when rate filings are above 15 percent on average and the company's intention to begin the increase before actually filing for it sidesteps that, said the lawmaker who crafted the legislation.
"This filing undermines the recent legislation allowing policyholders the ability to provide input and comments at a public hearing prior to the implementation of a homeowner's rate increase," said Sen. Rudy Garcia, R-Hialeah.
The company said earlier that because of the problem of the record four hurricanes, it wouldn't renew 95,000 residential homeowner policies. It also won't renew any of its 16,000 commercial policies and won't write new ones.
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