The week ahead: Property insurance questions loom as regulators ponder a pair of rate hike proposals

One week before lawmakers will reconvene for another special session on Florida’s property insurance regulatory environment, a pair of property insurers have rate hike proposals before state regulators. Meanwhile, the board of Citizens Insurance, a state-subsidized alternative, will meet to consider reinsurance and risk transfer issues.

The Florida Office of Insurance Regulation will hold a hearing on Tuesday at 11am to consider a proposal by First Floridian Auto and Home Insurance Co. to raise property-insurance rates, and then return at 2:30pm to consider a similar proposal by Florida Farm Bureau General Insurance Co. and Florida Farm Bureau Casualty Insurance Co.

On Wednesday at 9am, the Citizens Property Insurance Corporation’s Board of Governors will meet to discuss reinsurance and risk-transfer issues plaguing the industry.

Increased reinsurance costs have made it difficult for some companies operating in Florida to make ends meet. Reinsurance is insurance coverage that protects insurers from catastrophic losses if too many of their insured homes sustain damage. But without reinsurance coverage, a homeowner’s policy may be worthless if the insurer can’t afford to pay a claim for damages.

Next week, lawmakers are likely to consider a proposal that would lower the threshold for accessing funds in Florida’s Hurricane Catastrophe Fund in the event of a storm. The move would lessen the amount of reinsurance protection insurers would be required to carry.