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Hurricane Insurance Rate Increase Request
10/27/08 - 03:24 PM
Associated Press
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click for larger image Tallahassee, Fla:

Officials with State Farm Florida are still fighting to raise rates for homeowners, despite being denied by the state’s insurance commissioner.

State Farm has asked that it be able to raise homeowners rates by an average of 47.1 percent. The insurer says it needs the increase to pay for future hurricane losses and make up for discounts given to customers who added storm shutters and took other steps to make their homes more resistant to wind damage.

Commissioner Kevin McCarty ruled in August the company failed to submit sufficient data to justify an average increase of that magnitude. It would have ranged from 23 percent in inland areas to 86 percent along Florida’s coastlines.

State Farm appealed that decision to a state administrative hearing judge. The judge began hearing evidence in the case Monday.

A spokesman for the Office of Insurance Regulation says there are questions about the way State Farm calculated its proposed rate increase.

State Farm officials argue the rate request is justified.

The state insurance commissioner and State Farm last year agreed on a 9 percent rate reduction after the company obtained a 52.8 percent increase in 2006.

State Farm Florida is Florida’s second-largest homeowner insurer with about 1 million policyholders. It’s second only to the state-created Citizens Insurance Corporation.

This week’s hearing is expected to last a few days.
   
(Copyright 2008 by The Associated Press.  All Rights Reserved.)

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