JUST IN: Citizens approves hikes in premiums that now exceed $3,000 in Palm Beach County

Dec. 12--The price of the average homeowner policy in Palm Beach County will bust through the $3,000 mark under 2019 premiums approved Wednesday by the board of state-run Citizens Property Insurance Corp.

For whatever consolation it provides, the higher proposed rates will be somewhat delayed, not kicking in until September. The proposals are subject to approval by state regulators.

Still, the plan is poised to deliver another punch to household budgets in a state that already pays the nation's highest home insurance bills. Citizens, the state's second-largest carrier, serves about 435,000 customers in Florida.

Statewide, a standard H03 homeowner policy from Citizens will rise more than 8 percent to about $2,850.

In Palm Beach County, the average cost is higher, climbing from $2,901 to $3,105, according to company figures. Citizens has about 40,000 customers in Palm Beach County.

Though hurricanes have taken a toll in recent years, company officials also emphasized rising expenses with claims not directly tied to storms, such as plumbing leaks. They say many of these are inflated by abuses including lawsuits and assignment of insurance benefits to contractors and other third parties.

"Unfortunately, our customers are paying the price for these exaggerated losses," said Gary Aubuchon, interim chairman of the Citizens board of governors. "The unnecessary increase in litigation continues to take a toll."

Other industry groups push back against that narrative. Among the voices is Amanda Prater, spokesperson for the Restoration Association of Florida, representing companies including contractors who clean up water damage.

"The property insurance industry is once again talking about ways to limit and restrict homeowners' rights and abilities by demonizing the assignment of benefits, a common insurance practice that has been around for more than 100 years," Prater said in November.

The practice "allows homeowners to make repairs to their homes immediately with no out-of-pocket costs and mitigates further damages," Prater said. "What insurance companies should be doing is focusing on ways to improve their claims handling processes and treating their customers fairly."

Citizens officials said hikes would be higher if state law did not cap the company's annual premium increases at 10 percent.

Among other moves, Citizens has introduced a "managed repair" plan designed to provide financial incentives for customers to use company-approved contractors. Citizens and other insurers also want state legislators this spring to change rules they say make it too easy and profitable to go to court for public adjusters, contractors and attorneys, who in turn fire back insurers could avoid problems by paying claims quickly and fairly.

The industry-supported Insurance Information Institute recently issued a report saying assignment-of-benefits lawsuits have spiraled out of control in Florida, from about 1,300 in 2000 to more than 79,000 in 2013 and nearly 135,000 by November of this year. The group calls it a "hidden tax" on consumers who ultimately pay for the claims in their premiums.

Florida Insurance Commissioner David Altmaier said in a statement Wednesday "AOB abuse is rampant" and he supports efforts to address it.

Altmaier said that left unchecked, it will "serve to be one of the most destructive market trends currently facing policyholders."

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