Two Florida insurance companies are seeking large rate increases for many already cash strapped Florida homeowners. Allstate’s Castle Key Insurance Company is seeking to raise insurance rates by as much as 31% for Florida homeowners, while its sister company, Castle Key Indemnity is seeking a rate increase as high as 36%.
Castle Key Insurance has close to 140,000 insurance policies statewide as of the end of last year, including close to 32,000 in Broward, Palm Beach and Miami Dade County. Castle Key indemnity has close to 126,000 insurance policies, including 21,000 in South Florida.
While the two companies have close to the same number of policies, Castle Key Insurance reported a claim paying reserve of 136 million at the end of last year while Castle Key Indemnity reported less than 15 million.
The insurance companies claim that the cost of reinsurance is rapidly rising and its losses and expenses have so far exceeded the premiums it collects and that it’s projected to increase with out a rate hike.
State regulators have until August to reject the increase, approve it, or approve a smaller increase.
This premium increase comes after six years of no hurricanes and when the property and casualty insurance industry has record profits. Profits for U.S. property and casualty insurers rose 63 percent to $27 billion for the first nine months of 2010.
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