Two Insurance Companies Withdraw Filings For Rate Increases
TALLAHASSEE - The Florida Office of Insurance Regulation (Office) announced today that AMEX Assurance Company and IDS Property Casualty Insurance Company withdrew their filings. The companies had requested a 49.1 percent rate increase for their homeowners' insurance lines of business.
During 2006, the insurance industry pointed to the high cost of reinsurance for the ever-increasing residential property insurance rates. Reinsurance is the insurance companies buy to cover large losses. The Legislature responded during the January Special Session by passing House Bill 1A which expanded the Florida Catastrophe Fund, making $12 billion in less expensive reinsurance available from the state. In March, companies submitted rate filings to the Office estimating how much this lower-priced reinsurance would reduce their rates. AMEX and IDS each filed a reduction of -26.1 percent.
The law also required all companies to make a second filing, after they negotiated their 2007 reinsurance coverage, which shows the actual savings. AMEX and IDS indicated their rate reduction of -26.1 percent in March was incorrect and that each company instead requires a rate increase of 49.1 percent.
To date, two hearings have been held to evaluate the "true-up" filings, four more have been scheduled and two are in the process of being scheduled. The Office had scheduled the AMEX and IDS hearing for August 21; the Office canceled the hearing following the companies' decision to withdraw their filings.
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