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Will Hurricane Irene Affect Insurance Rates in Florida?

With projected insured losses from Hurricane Irene between $1.5 billion to $6 billion, the storm will not directly affect insurance rates in Florida. But losses...
September 7, 2011

With projected insured losses from Hurricane Irene between $1.5 billion to $6 billion, the storm will not directly affect insurance rates in Florida. But losses from the hurricane could indirectly impact rates in the state in a number of other ways. Insurers that sell in multiple states with major losses in North Carolina and the Northeast could try to increase rates in Florida. John Rollins, an insurance industry consultant with Rollins Analytics, explained that companies cannot raise rates directly in Florida to make up for these losses, but they can decide to seek rates closer to what their projections show they should be charging. Also, reinsurance prices could increase somewhat because of all the disasters worldwide. But there is some disagreement about whether reinsurance prices in Florida will be affected. Robert Hartwig, president of the Insurance Information Institute, does not expect Irene to have much effect because "rates in Florida are by far primarily affected by what happens in Florida and what is expected to happen in Florida." He added that reinsurance rates for insurers in the state will depend mainly on the outcome of the rest of the hurricane season.

Read more on the Florida rates: Will Hurricane Irene Affect Fla. Rates? (Fort Lauderdale Sun-Sentinel 9/2/11)

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