Florida customers of the state's largest property insurance company — including many homeowners who live near the coast — will be paying more in the coming year.
State regulators on Monday announced that they had approved an overall statewide rate hike of 6.3 percent for customers of Citizens Property Insurance Corp.
The hike means that the state-created Citizens — which has 1.22 million policyholders— will have raised its rates for four straight years.
The Office of Insurance Regulation's hike is slightly smaller than what Citizens officials had requested. The increases would take effect in January and February 2014.
But the range of hikes varies depending on where homeowners live and what type of policy they have with the insurer.
Many policyholders in South Florida as well as coastal counties such as Sarasota, Escambia and Volusia may see a 10 percent jump in their insurance bills while the rate change will be lower for those who live further inland.
Barry Gilway, president and CEO of Citizens, maintained that exposure to hurricanes and sinkholes were the "major drivers" behind the need for the rate hikes this year.
In a statement, Gilway said he was pleased that regulators "agreed with our overall approach."
Citizens would have likely asked for larger increases next year — but state law does not allow Citizens to raise rates on most coverage more than 10 percent a year. That cap does not apply to sinkhole coverage.
The final order issued by regulators allows sinkhole rates to go up by 20 percent in Hernando and Pasco counties and 50 percent in Hillsborough County.
Citizens has the power to place a surcharge, also called a "hurricane tax," on its own policies and on the policies of most insurance policies if it can't cover its losses following a major storm.
That has prompted a push by Gov. Rick Scott and others to force Citizens to improve its finances. Citizens has billions of dollars in surplus now, but a series of a storms, or back-to-back years with major hurricanes, could wipe out surplus out.
"The agency's action will allow Citizens to continue providing quality service to our 1.2 million policyholders while reducing the risk of assessments on all Floridians," Gilway said in his statement.
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