ATLANTA (AP) — A division of Assurant will reduce some rates under a deal with the Florida Office of Insurance Regulation over its lender-placed hazard insurance program.
American Security Insurance Co., an Assurant Specialty Property subsidiary, will file for a 10 percent cut in lender-placed hazard insurance rates in Florida. Once the company files for the reduction and it is approved, the rates are anticipated to go into effect for new and renewing policies beginning in 2014's first quarter.
Lender-placed hazard insurance is coverage that a mortgage lender buys for a property when the homeowner doesn't buy coverage, buys too little coverage, or fails to renew an existing policy.
American Security will also get rid of commissions and client quota-share reinsurance arrangements in order to meet new Florida requirements. The new lender-placed practices are expected to take effect in Florida one year after the agreement.
American Security recorded $510 million of direct earned premiums and $372 million of net earned premiums before catastrophe reinsurance costs in Florida in 2012.
Assurant Specialty Property is a unit of Assurant Inc., a specialty insurance products and services provider.
Shares of Assurant added 15 cents to $55.24 in Tuesday afternoon trading.