Editorial: Citizens seeks new rates, more homes
OUR POSITION: While seeking higher rates
It's not difficult to imagine
But it was never supposed to be this way and lawmakers, if they stick to their promises in the past, won't let that happen. Because, if that did ever come to pass, it could nearly bankrupt the state.
This scenario — while we admit it being quite unlikely — is not just hyperbole. The tremendous growth of Citizens, which was created as a home insurer of last resort, is startling. The assets it is insuring, if they were all wiped out in a major hurricane, would deal a crushing blow to the state which backs up the claims.
Yet, as more insurance companies leave the
If you recall, lawmakers just last year were urging Citizens to rid itself of policies. They feared the company was getting too big. But the growth hasn't stopped.
Citizens will surely have 1 million policies before hurricane season is over at the rate they are growing — adding 100,000 since January this year. Its growth is resting at nearly 11% a year. Consider that Citizens had638,263 policies on
And, what may make matters worse, Citizens is asking to be able to insure homes across the state whose replacement costs would be
Citizens tried to slow things down by asking the Legislature for a rate increase of 11%.
That amount, however, is nothing compared to 30% and more rate increases private insurers are asking.
That kind of inflation in insurance policies is driving people to Citizens in droves.
Could the state-backed insurer collapse under the mountain of new policies? We don't think the state will let that happen. But what is even more concerning is the cost of defending thousands of lawsuits file against Citizens, which is seeing more than its share of suits that plague the entire insurance industry.
We've written a lot about these suits. Most of them are for new roofs and that cause the state to call a special session for legislators earlier this year where they addressed the issue. But, so far, nothing has slowed down the suits filed — about 20,000 so far just against Citizens.
The insurance industry is facing a tsunami. Lawsuits, inflation and the lack — or high cost — of re-insurance that is bought to cover catastrophic losses are hammering insurers right now. Citizens set aside
Answers are elusive.
There will be more work for lawmakers to do when they return to
RV Insurance Market Is Booming Worldwide : National General Insurance, Foremost Insurance Group, Lazydays Holdings
Your Financial Future: What a Mega Millionaire should do
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News