Hartford Insurance Group Rate Hearing Recap

On Thursday, August 16, 2007, this office attended a public hearing for rate filings submitted by the Hartford Insurance Group (“Hartford”). 

Hartford requested statewide average rate increases in Florida of 29.5 percent for its homeowners business, a 46.4 percent rate increase for its AARP homeowners program, a 50.5 percent rate increase for its dwelling fire business, a 100 percent increase for its AARP dwelling fire program, a 146.3 percent rate increase for apartment building coverage under its Spectrum program, a 210.8 percent rate increase for apartment building coverage under its Property Choice program, a 121.7 percent rate increase for condominium building coverage under its Spectrum program, and a 225.9 percent increase for condominium building coverage under its Property Choice program. 

The members present from the Office of Insurance Regulation (“OIR”) were Belinda Miller, Deputy Commissioner; Michael Milnes, Deputy Director; and Allan Schwartz, Actuary.  After brief introductory remarks from the OIR, representatives from Hartford presented their reasons for seeking the rate increases, which were described as primarily due to their reinsurance contracts and overstated projected savings in their March filing. 

Hartford submitted an amended filing which changed the rates noted above to 31.6 percent increase for its AARP homeowners business, 69 percent increase for the AARP dwelling fire business, 22 percent increase for the homeowners business and a 35.9 percent increase in their dwelling fire business.  The difference between the decreased rates from March and the rate increase requested at this hearing would result in actual rate increases of 2.8% for their AARP policies and 0.4% increase for their Agent Produced policies. 

The OIR questioned Hartford representatives about how they set their reinsurance contacts, and whether they were setting their rates in a manner that would provide relief to their policy holders as the increase in Florida Hurricane Catastrophe Fund capacity was intended to provide.

Hartford currently has 67,000 policies under its AARP homeowners program and 30,000 policies under its Agent Producer program.  The company is not currently writing new policies under these programs, but it is renewing existing policies and renewing or transfering AARP policies for clients who are moving within the state.

Following a presentation by the Florida Insurance Consumer Advocate’s office and further questions to Hartford, the meeting continued with a discussion of Hartford’s commercial lines business, which consists of commercial residential and commercial non-residential policies.  Representatives from Hartford presented their reasons for seeking the rate increase, which they described as primarily being due to reinsurance contracts.  Hartford currently has 104 policies under its Property Choice program and 14 policies under its Spectrum Program.  The company is currently writing new policies under these programs. 

The OIR indicated that it will take all comments from this hearing into consideration, but will not be leaving the record open.  Although a specific date was not provided regarding a decision on this filing, we expect one in the near future.

Should you have any questions or comments regarding the above information, please feel free to contact this office.