Florida Insurance Commissioner McCarty Issues Final Order in Hartford Rate Challenge
– Florida Insurance Commissioner Kevin McCarty has affirmed the ruling of an administrative law judge regarding the rate filing challenge between the Office of Insurance Regulation (Office) and The Hartford Companies (Hartford). The commissioner’s Final Order
officially disapproves the rate filings submitted by Hartford and adopts the judge’s findings of fact and conclusions of law.
The matter was heard Jan. 22 – 24 at the Division of Administrative Hearings (DOAH), and a Recommended Order disapproving the rate filings was issued March 28 by Administrative Law Judge Lisa Shearer Nelson. The judge’s recommendation was based on the deficiencies set forth in the Office’s original Notices of Intent to Disapprove
, issued Sept. 10.
“The Office is pleased with the ruling, and we feel strongly that this supportive decision will further help us in our endeavors to protect Florida consumers from unwarranted rate increases,” said Commissioner McCarty.
Hartford initially reduced its rates by an average of 13.6, effective June 1 in accordance with the Office’s Presumed Factors. But, with its Sept. 30 True-Up filing, Hartford requested an average increase of 39.6 percent.
As part of HB 1A, passed by the Florida Legislature in January 2007, the Florida Hurricane Catastrophe Fund (CAT Fund) was expanded to $28 billion – a $12 billion increase – and insurers were requested to purchase cheaper reinsurance from the increased CAT Fund and pass the savings along to their policyholders.
Of the 200-plus insurers that made true-up filings, only two resulted in litigation, Hartford and Farm Bureau. On April 1, an administrative law judge in the Farm Bureau matter similarly recommended an order in favor of the Office. A Final Order from Commissioner McCarty is expected to be issued soon.
Hartford may appeal the order to the District Court of Appeal within 30 days.