Citizens Insurance has formally requested a 15% rate increase for 2026, the maximum allowable under state regulations. This move is designed to bring Citizens’ rates closer to the market rates offered by private insurers. The request was approved by Citizens’ board of governors, positioning the insurer for a potential large rate adjustment next year.
Background and Context
The latest data from Citizens Insurance reveals that the company currently holds 777,592 active policies in Florida. The insurer continues to lose policies to private insurers through take-out offers. This trend is part of a larger shift in Florida’s insurance market.
Rate Hike Discussion
The proposed rate increase has sparked debate among the board members. Charles Lydecker expressed concerns, referencing recent reports about the CEO of a private Florida insurance company receiving $50 million in salary along with his wife. Lydecker suggested that such large executive compensations might indicate that the current approach to rate hikes needs reevaluation.
Regulatory Process
The rate hike request now awaits approval from state regulators, a process that typically takes several months. This regulatory scrutiny follows last year’s experience where Citizens’ request for a 14% rate hike was only partially approved, resulting in an actual increase of about 6.5%, which took effect recently.
Conclusion
The outcome of this rate request will significantly impact Citizens Insurance policyholders and the broader Florida insurance market. As the regulatory process unfolds, stakeholders will be watching closely to see how the situation develops.
