Even in a year flush with property insurance rate hikes, this one sticks out.
First Community Insurance, a subsidiary of St. Petersburg-based Bankers Insurance Co., wants to raise homeowners insurance rates an average of 26.7 percent, among the highest requests of the year.
The Florida Office of Insurance Regulation has scheduled a hearing for 1 p.m. today in Tallahassee to consider the proposal. The hearing comes the same day that the office's boss, Florida Insurance Commissioner Kevin McCarty, is convening a half-day symposium in Orlando to discuss the outlook for Florida's property insurance market, which remains fragile despite four consecutive mild hurricane seasons.
Insurers have said the lack of hurricane damage payouts has done little to help their bottom line. Many insurers have either cut back exposure in Florida or sought rate increases this year, citing cost drivers like fraud, windstorm mitigation discounts and higher reinsurance. Reinsurance refers to an added layer of coverage that insurers buy to protect themselves from catastrophic claims.
In its request, First Community said a nearly 27 percent rate increase is justified in part because its lowest rates currently are in hurricane-prone parts of the state. It stopped writing dwelling fire policies with wind exposure in southeast Florida in June because of the rate imbalance, the company said. It also noted higher reinsurance costs and the financial impact of doling out windstorm mitigation discounts.
Among more than 100 homeowners' rate filings with the state so far this year, only two requests have been higher.
A 30.2 percent request from Northern Capital was withdrawn, while a 33.3 percent rate request for Castle Key Insurance was cut down to 18.7 percent by regulators.
First Community has about 61,000 policies statewide, including 2,000 in Hillsborough and Pinellas counties.