State refuses Florida Farm Bureau insurance rate increase: What’s next?
Aug 6, 2008
Orlando Sentinel--August 6, 2008
Anika Myers Palm
Sentinel staff writer
Florida Farm Bureau is contemplating its next move now that the Office of Insurance Regulation has rejected the company’s request to raise its property-insurance rates.
The company is considering whether to ask for another hearing to get its rate request approved — or to reduce the number of policies it has in the Sunshine State.
“We don’t have to please stockholders, but we at least have to break even,” said Bert Gindy, Florida Farm Bureau’s vice president of government affairs.
In its search for balance between the money it collects in premiums and what it could pay out after a damaging storm, Farm Bureau officials told insurance regulators June 20 that they wanted to raise policyholders’ rates by an average 28.4 percent statewide.
The state’s decision to deny the increase followed a tense public hearing last week in Tallahassee, during which insurance regulators grilled Farm Bureau actuary Missy Shelley and vice president of finance Michael Hill about the company’s request.
In a written statement announcing the insurance office’s plan to deny the request, Deputy Insurance Commissioner Belinda Miller said Tuesday that Gainesville-based Farm Bureau didn’t provide enough support for the premium increase.
Insurers have chafed under requests from the state Legislature and Gov. Charlie Crist that they lower their homeowners-insurance rates. The companies have said they need to charge rates commensurate with the risk they are taking by covering homes in the nation’s most hurricane-prone state.
The Office of Insurance Regulation has not approved a rate-increase request from a property insurer in more than a year.
Florida Farm Bureau, which has fewer than 100,000 policies statewide, has 21 days to ask the insurance-regulation office for an administrative hearing. A June 2007 reduction of nearly 25 percent in the company’s homeowners-insurance rates remains in effect.