Nearly three dozen insurance companies have asked for homeowners rate increases since last fall, and phones have been ringing off the hook at the state’s Insurance Hotline with customers demanding an explanation.
Now the state’s Chief Financial Officer is calling for a rate freeze. Insurers say a freeze might end up hurting homeowners in the long run.
The calls pour in constantly to the state’s insurance hotline. Many calls are from angry homeowners frustrated by double-digit rate increases they got even before last summer’s storms.
Hotline operator Heather Davis says homeowners are stunned when they open their bills.
“They always are because usually it’s not a little bit, it’s going to be a lot these days and they’re not sure if it has to do with the hurricanes or what it has to do with. It’s hard for them to understand.”
The calls are coming in from all over the state, and it’s no wonder. Thirty five companies have requested rate increases since October.
Florida suffered more than $20 billion in insured losses from the 2004 hurricanes, but Florida’s Chief Financial Officer says it’s time to put the brakes on the rate hikes.
Tom Gallagher called for a rate freeze this week after nationwide asked for an up to 89 percent hike for homeowners to nearly triple the bill for some mobile home owners.
But Jeff Grady with the Florida Association of Insurance Agents warns a rate freeze could result in even fewer companies willing to sell you insurance.
“If they’re looking at Florida, the most hurricane-prone alley in the world, and they do not believe they can get a price for the risk they are taking on, they will choose to do business elsewhere.”
In the meantime, the state has called for public hearings into Nationwide Insurance Company’s rate hike requests.
Florida’s Office of Insurance Regulation is reviewing whether it has the legal authority to impose a rate freeze. The office says it will push for a delay in approving or rejecting rate hike requests until at least the end of the spring legislative session.