Newly elected Gov. Charlie Crist has submitted an emergency order that would prevent homeowners insurance companies from seeking new premium hikes for as much as five months.
The order, which comes before the state's Financial Services Commission today, is expected to be approved. Crist sits on the commission, along with Florida's attorney general, chief financial officer and agriculture commissioner.
write insurance policies for them, except for the state-sponsored Citizens Property Insurance Corp.
More than 40 homeowners insurers have filed for rate changes in the past month, according to the Web site maintained by the state Office of Insurance Regulation. The companies include Tower Hill Select, Tower Hill Preferred, Universal Property & Casualty and First Floridan Auto & Home.
It was unclear late Monday how many of those were rate increases and how many were requests for approval to impose various surcharges.
A number of surcharges have been levied on policyholders in the past year to offset costs associated with the insolvency of the three insurance companies run by Poe Financial Group, for hurricane losses at Citizens and to bolster the state's Hurricane Catastrophe Fund, which was depleted by the 2004 and 2005 storm seasons.
Rate hikes are subject to rejection by state insurance regulators, though insurers can temporarily bypass the regulatory process and raise premiums without approval.
However, if regulators later determine the hikes were improper, they can order a company to reduce those rates and provide customers with refunds. That provision, known as "use and file," will be suspended for two years once the state's new rate-reduction act goes into effect.
The news was not met with joy by representatives of the insurance industry, some of whom accused Crist of grandstanding.
William Stander, regional executive vice president of the Property Casualty Insurers Association of America, said insurers had not been notified of the emergency order.
''Obviously they are more interested in getting a story in the newspaper than in letting us know about it,'' Stander said. He said insurers know that Crist and the legislature want to reduce rates and are working toward that goal.
Crist's order also does not affect the six insurers whose rate hikes have been rejected by insurance regulators and that have filed for binding arbitration.
Arbitration hearings begin today for the first of those insurers, Home Wise Insurance Co. Under the "use and file" rules, the company put into effect a 75.8 percent rate increase on Aug. 15. The hike was rejected by regulators in October, but Home Wise officials filed for the arbitration, so policyholders have not received refunds.
A three-member arbitration panel will determine whether the rate increase is valid after a multiday hearing.
The plan approved by lawmakers and signed into law by Crist last week also suspends new arbitration hearings for two years. Insurance regulators have maintained the arbitration hearings are biased toward the industry.