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New Legislation to Stop Citizens From Raising Rates Over 10 Percent Annual Cap

State legislators from South Florida have filed legislation intended to block an attempt by Citizens Property Insurance Corporation to raise rates to new policyholders over the 10 percent current cap allowed for increases to current policy holders.. According to, the company tried to do the same thing last year, but backed down after legislators questioned the move’s legality.

Now, legislators from Miami-Dade County want to leave no doubt that the cap applies to all customers, both new and existing, by filing legislation specifically tailored to that end.

More Debates Over Citizens in the Horizon

Similarly, the new legislation hints at renewed debates in Tallahassee this spring over plans to reduce the Citizen’s size. Florida Governor Rick Scott and other state leaders have tried to reduce Citizens’ portfolio (which stands at over 1.4 million policies) as they claim they are concerned about the company’ ability to handle a disastrous hurricane season. They fear that should disaster strike, they may be forced to establish a so called “hurricane tax” that could effect many Floridians. This move is in spite of the fact that Citizens has accumulated more than $6.2 billion in reserves thanks to several Hurricane seasons that saw little windstorm damages (the last was Hurricane Wilma which hit Florida in 2005) and a continued strategy by Citizen’s of raising rates and deductibles, intended to make itself less “desirable” a choice for policyholders.

However, we should point out that such a tax assessment could also result from the financial failure of some of the private companies whom the Governor and other supporters of reducing Citizens’ size want to cover policyholders. Many of these “private” insurance companies are in much worse financial shape than the state sponsored homeowners’ property insurer and are less likely to be able to handle claims in a catastrophe.

Opponents to Citizens’ current strategy to raise rates beyond the 10 percent allowed by law, argue that proof of the thin financial inability of private insurers to offer effective coverage to Florida homeowner’s is proven by the fact that most of these “private insurers” decline to write coverage for coastal areas (where the majority of the population lives) leaving Citizens as the only viable alternative for homeowners living in those areas.

The Lawyers of Greenberg Stone and Urbano Can Help

You should always have an attorney help you review your policy and advise you on what coverage you should have and for how much. If you are about to renew your policy (with the same insurer or a new one), we can help you review it and make sure you are adequately covered and in a position to avoid costly expenses should disaster strike.

Moreover, please note that if your home has already sustained damages, even if you are not sure if those are “a covered loss,” or if you don’t think the loss will exceed your deductible, our team of loss consultants, paralegals and attorneys will assist you in determining if you have coverage and if so, represent you in every aspect of your claim. Our loss consultant will even go to your home to evaluate the damage you sustained at no cost or obligation to you. Contact us today for a free inspection by our loss consultant.

With more than 100 years of combined experience, the Miami Dade County Homeowners Insurance Claims Law Offices of Greenberg Stone and Urbano have helped thousands of Homeowners all over Florida review their policies, present their claims and get the compensation owed them by their insurance carrier. Visit our website to learn more about our firm and contact us today for a free consultation.

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