[StBernard] State of Florida Denies Insurance Rate Hike

[Westley Annis]

State denies rate hike for property insurer
By Jeff Ostrowski

Palm Beach Post Staff Writer

Wednesday, October 18, 2006

UPDATED: 6:37 p.m. October 18, 2006

In a rare bit of good news for policyholders, Florida Insurance Commissioner
Kevin McCarty today rejected Nationwide Insurance Co.'s call for a 71.5
percent rate increase.

The state's fourth-largest homeowners insurer failed to justify an increase
that would have sent some homeowners' bills soaring, McCarty said.


"Many Floridians are being forced to make painful economic choices to deal
with rising insurance premiums," McCarty said in a statement. "In such an
environment insurers must redouble efforts to fully and completely support
all requests for increased rates, and that has absolutely not been done in
this case. The filing contains proposed hurricane rate hikes in excess of
300 and 400 percent for some territories, which are entirely unsustainable."

Nationwide in July asked for the rate hike, which was to take effect Nov.
10. Nationwide blamed higher costs for reinsurance, the coverage insurers
must buy to protect themselves from catastrophic losses.

Nationwide has some 253,000 policies in Florida, including 29,199 in Palm
Beach County, McCarty said.

"We are concerned with the denial of the rate request given the risks and
challenges that are very real in the Florida insurance market," Nationwide
spokesman Joe Case said in a statement. "The rate request reflects the cost
of doing business in Florida. That cost includes the rising price of
reinsurance, labor and re-building materials."

  
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