We are still talking about a recent analysis of insurance companies’ market conduct reports. The researchers looked at property and casualty companies and life and health insurers to identify the areas that regulators most often cited as problematic.
Insurance is a highly regulated industry, and state insurance departments keep track of how well companies are complying with all those regulations. Every insurance company operating in the state of Florida is subject to a full market conduct review. The Office of Insurance Regulation determines how often the reviews are conducted, but state law dictates what the OIR reviews.
We are picking up our discussion from Sept. 20. We left off with some basic information about force-placed insurance, the profits it reaps for the insurers and the coverage gaps it results in for homeowners.
Thanks to the combined pressure of the Securities and Exchange Commission, insurance regulators from Florida and four other states, the National Association of Insurance Commissioners and consumers, Assurant Inc. recently shared sales data for its force-placed insurance line. The company said it had collected $90 million in premiums from two of the four states that have questioned force-placed rates.
Congress recently approved an extension for the National Flood Insurance Program. Rather than expiring this past July, the program will run through 2017. Florida residents welcomed that decision, particularly since hurricane season was underway, and they did not want to be left without the needed property insurance should any hurricane damage their homes.
Back in May, the National Oceanic and Atmospheric Administration predicted the 2012 hurricane season would feature nine to 15 named storms, with four to eight of them becoming hurricanes. One to three of those hurricanes, NOAA said, will become “major” hurricanes, marked by winds of 111 mph at the very least. Overall, the agency said there was a 70 percent chance the season would be “near normal,” as forecast.
Executives and board members of Citizens Property Insurance Corp. may not have gotten the reception they hoped for at a recent public hearing. Florida’s state-backed insurance company told the crowd at the Miami meeting that rates will go up again next year as the company struggles to address its shaky financial position. Citizens officials will meet with state regulators next week to finalize changes to homeowners, renters, condominium and mobile home rates.
Congress has passed a National Flood Insurance Program renewal bill that will not expire in 90 days. The program was set to expire at the end of July. With this new measure, Florida residents will not have to worry about gaps in coverage until Sept. 30, 2017. The bill also included several reform measures long sought by insurance companies, brokers and agents.
From 1997 to 2010, Florida had more lightning strikes per square mile than any other state, according to the National Lightning Detection Network. That time span includes a few fierce hurricane seasons, of course. The property damage from those storms totaled somewhere in the billions, with each storm costing more than the last.
We are finishing up our discussion of a homeowner’s lawsuit that he hopes will be certified as a class action. He asserts that his lender and a homeowners insurance company charged him an exorbitant amount of money for force-placed coverage when his homeowners policy lapsed. The difference in cost was staggering: The bank’s premium added up to $18,000 per year. His private policy cost about $2,500 a year.
