Annual Rate Increases for Coverages by Citizens Property Insurance Corporation
The bill seeks to amend section 627.351 of Florida Statutes, which governs the Citizens Property Insurance Corporation's operations and its rate-setting processes. The changes are designed to potentially encourage the issuance of new coverage policies and renewals by relieving them from the stringent rate increase caps that apply to existing policies. The corporation will still be subject to annual filings for actuarially sound rates but with the intention of allowing for flexibility in rate determination for new policies post the specified date.
House Bill 0705 proposes amendments to existing regulations regarding annual rate increases for coverages provided by the Citizens Property Insurance Corporation. The key change introduced by this bill is that the mandated annual rate increases and limits on such increases will not apply to new policies issued after June 1, 2025, and for the renewals of these policies. Currently, the corporation is required to implement uniform annual increases capped at 12% to 15% over the next several years, depending on the specific effective date. This amendment aims to adjust how these rate settings impact newly issued and renewed policies moving forward.
Notable points of contention surrounding HB 0705 are the implications on the quality and affordability of insurance coverage for policyholders in Florida, particularly in hurricane-prone areas. Proponents suggest that loosening the rate constraints could stabilize the corporation's financial health and ensure better service delivery. In contrast, opponents raise concerns that this could lead to significant cost increases for consumers and possibly hinder access to affordable insurance coverage, particularly for vulnerable populations who rely on the residual market for property insurance during high-risk storms.