Still Denies Rate Hikes.
Many Homeowner's Insurance Companies and other Property Insurance Companies in Florida have asked for rate hikes based on 'alternative' computer models of Catastrophe Risk. These models appeared for the first known time after the 2005 Hurricanes. Insurance Companies across the country have relied on them in support of applications for increased premiums because of exposure to Hurricane and other Catastrophe Claims allegedly magnified beyond the comparatively benign results based on facts as in the standard, approved computer model. These rate requests were not successful in 2006, certainly to the extent that any one of them relied on unsupported, 'alternative' computer models of high-risk-opinion data. This background is discussed and analyzed in previous posts on this site, including these two posts at Christmastime, 2006: "Primary and Excess Flood Insurance ... And CatClaim Computer Models" (December 24, 2006) and "Computer Models: Facts In, Opinions Way Out" (December 23, 2006).
In 2007, it is Allstate which has been denied increased premium requests based on unauthorized models. To be sure, Allstate is not the only Insurance Company in Florida in 2007 requesting rate hikes. However, Allstate's proposed rate hikes were rejected and one of the reasons continues to be reported use of unauthorized modeling to predict future Hurricane Catastrophe Claims. The 'new modeling' if you will depends on opinion input, resulting as might be expected in predictions output of more and greater so-called Catastrophe Claims, which lead in turn to requests for rate increase output. The unauthorized use of models to support unsuccessful applications for rate hikes in Florida is one of the "5 Big Stories: The Week in Business" by Jeff Harrington (St. Petersburg Times Online at www.sptimes.com, Sunday, November 18, 2007).
Please Read The Disclaimer.
Comments