 From Keysnews.com: FIRM celebrates wind win with parade
Insurance regulators focusing on Citizens rate proposals
BY ANN HENSON Citizen Staff Citizens Property Insurance Corp. on Friday would not say whether it will accept or appeal the state's order to lower its windstorm rates in Monroe County. Spokesman Rocky Scott said the corporation has no comment, except to say officials are reviewing the order. Insurance Commissioner Kevin McCarty on Thursday ordered the wind insurer of last resort to reduce Keys homeowner rates by 32.2 percent and mobile home rates by 15.2 percent. The news prompted a handful of Fair Insurance Rates Monroe members to parade from one end of Duval Street to the other, en route to a fundraiser at Conch Republic Seafood Company on Greene Street. The grassroots group has led the fight against the crippling rates. While policyholders were celebrating the victory, officials were closing in on a figure. The exact amount of the decrease was unclear Thursday. "We've run the numbers and we think that the new base rate will be $17.22 per $1,000 in coverage, but we cannot tell for sure from the order," said Nat Cassel, a Monroe County assistant county attorney who has been working on this issue. "It's crazy when you cannot figure out what it's going to be and even that will depend on the individual coverage," she added. Factors include the age of the home, its characteristics and additions to reduce damage, such as storm shutters and roof tie-downs. Depending on what rate is used, the new base rate is somewhere between $11 and $17, said Heather Carruthers, who handles media relations for FIRM. McCarty's order directed Citizens to use only one method to calculate rates: the public hurricane model, which received certification last spring. Citizens uses several private models to determine how much potential statewide damage could be attributed to the Keys in any given storm, said Tim Volpe, an attorney the county hired specifically to fight Citizens. Volpe, who reviews each document Citizens uploads to the Office of Insurance Regulation, said some of the models show a high probability while others come in somewhat lower. Citizens averaged the highest and lowest to come up with a number in the middle, he said. "What we advocated is it's unlawful for Citizens to use these black-box private models that can't tell you anything about how they derived" their figures, Volpe said. The public model ranks Monroe County as 16th in the amount of statewide storm damage. "The public model is a sounder approach and unless the private models are willing to share all their assumptions and factors then only the public model can be used," he said. Carruthers said FIRM members are very happy with the decrease. "No matter how we calculate the rate, it is roughly equivalent to the rate in 2004 and is less than what was in their rate tables in 2002," she said. She said FIRM will work on other insurance issues such as condominium rates, getting lower rates for hardening structures, and determining how much coverage policyholders should carry. "Citizens was asked to audit Keys policies," Carruthers said. "That will be helpful to us because we may be insuring land" in addition to structures, she said. The group also is turning its attention to Florida Peninsula Insurance Company's proposed rate increase, which McCarty is reviewing. Florida Peninsula wants a 98-percent increase, which will top Citizens' rate. Florida Peninsula is a private company that takes policies from the quasi-public Citizens without consulting the policyholder.
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