Florida's taxpayer-backed insurer of last resort is considering rate hikes that will affect more than one million property owners.
On Wednesday, the Citizens Property Insurance Corporation board of governors will consider an increase of an average of 14% for all personal line policies.
This includes homeowners, condo owners, dwellings renters and mobile homes.
If approved by the board, the recommendations will be submitted to state regulators, who will review the filings and then hold a public hearing before establishing Citizens' 2025 rates.
In January, Citizens announced that it hopes to reduce its client list in what it said is an effort to help fix the state's insurance market.
"Folks say, 'I need affordable insurance.' I agree. We want insurance to be affordable, but that's why we need to have more competition; we need to have more private companies coming back into the state," the company's CEO, Tim Cerio, said in January.
Around a month later in February, Citizens said it would now require new policyholders and those up for renewals to carry flood insurance.
Years ago, Cerio said the state legislature froze the maximum rate Citizens could raise, limiting it to a certain percentage.
However, it prevented Citizens from charging premiums that matched the risk of the homes they were covering. They said many of their 1.1 million policy owners are paying less than what they should based on the risk of their homes. This is why Citizens could be in big trouble if a big storm hits our state.
"We are the state created insurer of last resort, we should not be competing with the private market," said Cerio.
"So does that mean that if you're on citizens, you can still expect your rates to climb?" we asked.
"We should be a little more expensive than the private markets, and that's not unfair if you if no one else wants to ensure you have a place to go, but you're going to we're going to be a little more expensive," he said. "I don't, nobody wants their rates to go up. But that is why I can in good conscience say look, if we're if you're with citizens, we want to take care of you. But chances are, your rates right now are below where they should be if you're in citizens."
Cerio said it's all about reducing risks, which is why Citizens is forcing homeowners off into the private market through a process they call depopulation. This reduces their risk in the state and raises their prices.
It’s exactly what people like Willie Butts told us they feared last year.
A private provider surged its prices, forcing the Apopka veteran to take Citizens and its proposed increases.
“I had no other choice in that move," he said.
But the market is better these days, so say regulators and Florida’s governor.
When asked about the rate increases, Wednesday, DeSantis listed potential signs of stabilization after years of tort reform to curb insurance lawsuits.
Florida has eight new insurers, 10 others filing for flat rates in the coming year, and another eight seeking small decreases.
“The only reason you're seeing companies come into Florida, the only reason you're seeing those types of rate filings in the private market, is because we did reforms to bring some sense to this market," said Gov. DeSantis.
DeSantis also went on to blame inflation and the federal government. Citizens, meanwhile, has been trying to shed policies, decrease taxpayer exposure, and avoid competition with the private market.
However, critics continue to say it’s not enough. Florida Democrats launched billboards this month across the state making the GOP’s handling of insurance a main talking point heading into November’s election.
“For 30 years, one party has controlled the state, and look what's happened. We have the highest teacher shortage in the nation. The highest inflation across the country, because Republicans refuse to get the benefits the rest of the people of our state— that the rest of the country is seeing because of Joe Biden," said Democratic Chair Nikki Fried.
But back here in Florida, that Citizens' rate increase is closer to a reality. The Sunshine State will now wait to find out what happens next.