Sep 182015

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On August 25, 2015, Fair Insurance Rates in Monroe (FIRM) President Mel Montagne, accompanied by FIRM Consultant Annalise Mannix, testified at a hearing before the Florida Office of Insurance Regulation to set Citizens Property Insurance Company (CPIC) windstorm and multi-peril property insurance rates. Mr. Montagne noted that CPIC underwrites 85-95% of the windstorm policies in Monroe County, and that FIRM disagreed with several assumptions proposed to be used by CPIC in its rate determinations. The issues he raised with the CPIC’s rate-setting included:

-Failure to allow mitigation credits for various types (including wood) of opening protection as required by Florida statutes.

-Placing the Keys in Terrain Category C, rather than in the more appropriate Category B, that would result in lower rates.

-Using an arbitrarily determined rate for coverage of building contents. Because of the high cost of Keys properties, utilizing a fixed percentage of that cost utilized to cover contents often results in a premium cost that vastly exceeds the value of the contents that could be claimed in a loss.

-The definition of transient occupancy as a rate determinant is not adequately justified. FIRM has long argued that building strength, not type of use, should be the prime factor in rate setting.

To elaborate FIRM’s position on building strength, Ms. Mannix presented the results of various engineering studies (including preliminary data from FIRM’s RIPP study) showing the superiority of metal roofs, window and door protection, and other aspects of typical Keys construction over lesser materials and techniques used in other Florida counties. She showed that other counties with higher loss and claims rates were paying substantially less in CPIC premiums than Monroe County.

Ms. Mannix also pointed out that CPIC ran several models to use in rate setting for condominium unit owner policies, and most models suggested significantly less vulnerability than the model that was used. Four models indicated rate increases of 30% to 50% while the Public Model, which is required to be used by state law, indicated a 176% increase. She suggested that the model clearly was an outlier and its use should be reconsidered.

FIRM remains committed to fighting for fair property insurance rates for Monroe County, Florida citizens and businesses. To obtain copies of FIRM’s testimony, including technical details, please visit

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 September 18, 2015  Posted by at 12:20 am Issue #132, Public Notice  Add comments

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