Florida Insurance Commissioner Kevin McCarty issued a Consent Order requiring United Property & Casualty Insurance Co. to refund millions of dollars in unapproved homeowners’ insurance rate increases.
Last October, United began charging its customers higher insurance rates before the Florida Office of Insurance Regulation officially approved the rate increase. The practice was allowed under Florida law at that time and was referred to as a “use and file” rate increase.
However, the law also stated that if, after the OIR reviewed the increase and determined that it was too high, it had the authority to require the company to return to policyholders the difference between the original rate charged and the rate ultimately approved. Based on the latest rate collection data, the actuarial estimate of the difference between the amount charged and the amount approved is $43,249,714.
“Recent legislation in Florida prohibits property insurers from using use and file rates in the future, but United engaged in this action last year before it was banned,” McCarty said. “We will continue to aggressively pursue all refunds and credits that are due to Florida consumers.”
The Consent Order requires United to begin refunding immediately. Following the refund process, the Office will ensure adequate refunds are processed by requiring a certification from United showing the final amount.
Source: Florida Office of Insurance Regulation
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