Office Of Insurance Regulation Denies Rate Filings
TALLAHASSEE (08/14/2007) - This week, the Florida Office of Insurance Regulation denied the rate requests of three companies for not substantially lowering their property insurance rates pursuant to House Bill 1A.
"Governor Crist and the Legislature made some courageous decisions during the January Special Session," said Insurance Commissioner Kevin McCarty, "and we will not allow companies to file incomplete or inadequate rate reductions affecting the policyholders of this state."
The Office sent Notices of Intent to deny the rate filings because the reduced rates filed did not adequately reflect all of the savings realized when the state offered less expensive reinsurance to companies last spring. Reinsurance is the insurance that companies buy to cover large losses.
"House Bill 1A made $12 billion of less expensive reinsurance available from the state, and the law requires the insurance companies to pass along that savings to their policyholders in the form of lower rates,"said McCarty. "Not to be invested in extra, duplicative reinsurance contracts or profit margins."
Companies have until September 30th to submit their final reduced rate filings mandated by the law and the Office will continue to review each one to ensure they are complete and reflect the policyholder savings ordered by the Legislature.
Last week, the Office postponed a public hearing for State Farm Florida Insurance Company, State Farm Florida Fire and Casualty Insurance Company and State Farm Mutual Automobile Insurance Company. The Office issued subpoenas directing the three companies to appear in Tallahassee to answer questions about its business practices. The companies failed to provide all of the information requested in the subpoenas by the date set forth in the subpoenas; therefore, the Commissioner postponed the hearings until the requested information is provided in its entirety.
The Commissioner has the authority to hold a public hearing to question a company about their filing pursuant to Florida law.
to read the Notices of Intent to deny the rate filings.
More information on the companies' rate filings which were rejected is listed below.
Company Statewide Proposed Rate
Name Policy Count Change
Cypress Property 63,129 -5.4%
First Floridian 91,295 -8.3%
Auto and Home
Travelers Indemnity 4,596 -8.3%
Company of America