Citizens Discussing Rate Hikes For New Customers

TALLAHASSEE, Fla. (CBSMiami) – Citizens Property Insurance Company continued down the path of raising rates for new policies Thursday during a conference call with the Actuarial and Underwriting committee.

The Thursday conference call didn't involve a vote, but several options for how to get more customers to not have Citizens insurance were discussed. The primary discussion surrounded a possible 30 percent increase in new policies.

Overall, new policy premiums would rise by 41.7 percent on average and non-coastal policies would see rates rise an average of 24 percent.

The thinking behind raising the rates is that by making it more expensive, less people will come to Citizens and instead seek out private insurance. Citizens is backed by Florida taxpayers. The flaw is that even as the plans are being discussed, more insurance companies are leaving the state.

The plan to push more people either off of Citizens or deterring them from coming to Citizens is being pushed hard by Governor Rick Scott.

Among the other options discussed Thursday was increasing new business rates by no more than 10 percent and increasing renewal rates by no more than 10 percent of the previous rate. By law, Citizens can't raise rates for customers more than 10 percent in a year.

Florida chief financial officers and other key state officials said the Legislature intended for the 10 percent maximum hike to apply to all customers.

Some board members chose to blame the media for the outrage over proposed rate hikes.

"For my money, I won't support rate increases as 60 to 90 percent rate increase in a single policy," said board member John Rollins. "It's simply not going to happen. The headlines focusing on dramatic rate hikes; these are not productive and there are three or four layers of checks and balances."

But, if Citizens chooses to hike rates on new customers by upwards of 30 percent, it could result in some customers paying up to 90 percent more than neighbors who are long-standing Citizens customers.

The next meeting will be June 7th at 9 a.m. in Jacksonville and it will be open to the public. A final vote is not expected until mid-July. Any potential rate hikes would likely take place at the beginning of next year.