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New law should give home insurance savings up to 50 percent

Sun-Sentinel - 3/1/2007 12:00:00 AM
by David Royse

TALLAHASSEE -- Homeowners could see average property insurance savings ranging from around 10 percent in the Panhandle to more than half in South Florida because of a new law meant to lower rates, state insurance regulators said Thursday.

After two years of extensive hurricane damage, Floridians have seen their property insurance rates double and triple.

That led the Legislature to pass a sweeping new law in January that seeks in large part to give insurance companies more access to cheaper backup coverage, with the savings to be passed on to customers.

Insurance companies must make filings using the lower rates for new policies beginning June 1. For others, the savings will be seen when policies are renewed after June 1.

Actual discounts will vary fairly drastically, depending on a variety of factors including what is covered, where the home is, and how much coverage the resident has.

But the Office of Insurance Regulation said Thursday that some Miami-area households could see savings of about 53 percent off their homeowners policy.

Most companies can expect to cut more than 40 percent on average off the cost of the hurricane portion of customer's premiums. The percentage of the drop from the overall premium will be a little lower, but the hurricane or wind damage portion of most policies accounts for much of the rate.

The average savings are lower in general in north Florida, where hurricane coverage is cheaper, and the highest in South Florida, particularly in the Miami area, where premiums are more expensive.