Citizens refund checks are coming
By ASSOCIATED PRESS
Published February 14, 2007
Citizens Property Insurance policyholders who are wondering about refunds can take heart - the checks are coming. Starting Tuesday, the state-run insurer of last resort began mailing refund checks to those whose policies were renewed in January of this year. The refunds cover a 21 percent rate hike that was eliminated by lawmakers during last month's special legislative session. The company, which has about 1.4-million policyholders, will issue a second round of refunds in March, with new, lower, rates put in place by April.
What does it mean?
Insurance companies are asking a court to throw out an emergency rule, passed last month by the Florida Cabinet, that was supposed to prevent insurers from raising premiums or dropping property insurance policies through most of this year. The insurers argue there is no emergency that requires such drastic action. They also complained that the rule was made retroactive to companies that in some cases had already notified customers that they intended to drop them later this year.
How did we get here?
In the wake of huge losses after 2004 and 2005 hurricanes, property insurers across Florida dropped hundreds of thousands of policies. For those they retained, rates have more than doubled in some cases. The state's insurer of last resort, Citizens Property Insurance, swelled to 1.4-million policyholders, or more than a third of the market. During a special session last month, the Florida Legislature passed a law aimed at lowering rates. But because it requires insurance companies to recalculate their rates, most of it won't go into effect until June 1. Gov. Charlie Crist and the Cabinet, fearing that insurers might drop policies and raise rates before the new law takes effect, passed an emergency rule to freeze cancellations.
[Last modified February 14, 2007, 00:57:26]
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