Florida Insurance Commissioner Issues Final Order in Florida Farm Bureau Rate Challenge
Jul 1, 2008
FLOIR Press Release--July 01, 2008
TALLAHASSEE, Fla. – Florida Insurance Commissioner Kevin McCarty affirmed the ruling of administrative law judge Susan B. Harrell regarding the rate filing challenge between the Office of Insurance Regulation (Office) and Florida Farm Bureau (Farm Bureau). The commissioner’s Final Order officially disapproves the rate filings submitted by Farm Bureau and adopts the judge’s findings of fact and conclusions of law.
The matter was heard Jan. 14 – 17 at the Division of Administrative Hearings (DOAH), and a Recommended Order disapproving the rate filings was issued April 1 by Judge Harrell. The judge’s recommendation was based on the deficiencies set forth in the Office’s original Notices of Intent to Disapprove, issued July 15, 2007.
“Rulings like this, and the one we received on the Hartford case, further help us in our efforts to protect Florida consumers from unnecessary and unsupported property insurance rate increases,” said Commissioner McCarty. “I’m very pleased with the judges ruling.”
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.
Farm Bureau initially reduced its rates by an average of 24.9 percent, effective June 1, 2007. But, with its May 10, 2007 filing, Farm Bureau requested an average increase of 30.3 percent.
Of 200-plus insurance companies that made HB 1A filings in the fall of 2007, only two companies – Farm Bureau and Hartford – sought litigation through DOAH. Commissioner McCarty issued his Final Order in the Hartford matter on June 2.
Farm Bureau may appeal the order to the District Court of Appeal within 30 days.