MAITLAND, FL – Citizens’ Board of Governors on Tuesday approved recommended rates and policy changes for 2018 that reflect rising non-weather water losses, assignment of benefits abuse and out-of-control litigation that, left unchecked, will force rate hikes for years to come.
By unanimous vote, board members recommended a 5.3 percent statewide increase for personal lines policyholders – homeowners, condominium unit owners and renters – with most increases concentrated in three South Florida counties where water losses, assignment of benefits abuse and litigation are disproportionately severe.
Board members also approved a series of policy changes aimed at reducing claims costs for nonweather water losses that have been pushing rates higher for South Florida customers over the last few years. If approved, the changes would take effect in February 2018.
Among the major policy changes is a $10,000 cap on water loss repairs for customers who decide not to participate in the Citizens Managed Repair Program, which links customers with a network of vetted contractors. The voluntary managed repair program, coupled with a free emergency water removal service, will become available to new Citizens policyholders after July 1, 2017, and for existing customers when their policies renew.
Other policy changes include expanding obligations to third parties that accept an assignment of benefits. Currently, contractors who accept an assignment are not bound by the same obligations, including allowing Citizens adjusters to inspect a claim in a timely manner or providing proof that a loss has occurred.
“These proposed rate increases and product changes are critical for Citizens’ efforts to bring some relief to a market that is being made increasingly expensive by unnecessary litigation and out-of-control water loss claims,” said Chris Gardner, Chairman of the Citizens Board of Governors. “Unfortunately, we are making it more expensive for many of our customers to own a home.”
Citizens has prepared a 2018 rate kit for the media with information about its 2018 rate filing, including answers to common questions and county-by-county estimates for particular policy types. Additional information about policy changes is available on the Citizens website.
The kit also includes information about Citizens’ costs and projected rate need for 2018.