March 16--Residents at the 17-unit Lady Alexander condo complex in Marathon are breathing a huge sigh of relief now that state-owned Citizens Property Insurance Corp. has backed off a proposed 1,300-percent windstorm rate hike for 2013-14.
State Rep. Holly Raschein met with Citizens officials Wednesday in Tallahassee to talk about the massive increase. She said she was assured the original quote of $20,735 -- still a 300 percent increase -- would be honored.
"That's what happens when you be diplomatic. They're going to honor the previously quoted premium," Raschein told the Keynoter. "How can anybody swallow that? We need to look at the reasons why these kinds of rate increases come in."
Monroe County Commissioner Heather Carruthers spoke about the increase -- from $7,351 in 2012-13 to $91,138 in 2013-14 -- during her a brief speech before Gov. Rick Scott and the Florida Cabinet last week.
Raschein aide Erin Muir said in an e-mail that Citizens indicated the following reasons for the large increase at the Marathon condo:
--There was a coverage increase for the property.
--The 10 percent standard rate increase for each property per year was applied.
--Mitigation credits were lost due to "re-inspections" ordered through Gov. Rick Scott's depopulation plan, which aims to drop as many as half of Citizens' 1.3 million policies statewide.
--A "procedural rule change in the system regulating how building are rated, which resulted in their building being given a different rating."
In addition, Citizens spokesman Michael Peltier told the Keynoter the state insurer of last resort agreed to refund the Lady Alexander $10,919 billed in error for 2012-13.
The condo received a $7,351 bill in February 2012 for April 2012 through April 2013. After re-inspection in July, the bill was upped to $18,270 and the residents paid that amount.
"It's not common practice to switch or charge more midstream. We're honoring the [$20,735] quote they received and we're going to credit the $10,919 that was added," Peltier said.
But the Lady Alexander is far from out of the woods. A letter to the condo from Citizens Director of Legislative and External Affairs Christine Ashburn says the premium will be at least $91,138 unless issues regarding storm shutters and roof construction are addressed.
The re-inspection took away all the condo's mitigation credits, including for shutters, concrete structure and the size of the nails used to construct its wooden roof. The Lady Alexander has made zero insurance claims of any kind since being built 40 years ago.
"When your policy subsequently comes up for renewal for the 2014-15 time period, all of the changes outlined above will be reflected and the premium for that period adjusted accordingly," Ashburn's letter said.
The 2013-14 premium hike would have increased owners' monthly condo fee from $475 to roughly $900. It appears that may happen next year unless the standards by which the condo is judged are changed.
"A rule change has to go through [the state Office of Insurance Regulation], but in terms of a premium, that's something Citizens can do internally," Raschein said.
Tempest said she realizes "our work is not done" with keeping the Citizens premium manageable.
"We have to really take the time and energy to work with them to revise how they're working on these things," she said. "They gave us a year to work with it and see what the problems are. I think it's a fair approach and I'm glad for the outcome."
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