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Class action lawsuit filed against Citizens Property Insurance Corp

Florida Association for Insurance Reform (FAIR) announces lawsuit against Citizens Property Insurance
Florida Association for Insurance Reform (FAIR) announces lawsuit against Citizens Property Insurance

A class-action lawsuit has been announced against the state’s largest property insurer. Citizen’s is being accused of artificially raising home values in order to charge higher premiums. Lynn Hatter reports a group called the Florida Association for  Insurance Reform, or FAIR, is backing the lawsuit.

Right now property insurance is based on the value and location of a home. The lawsuit brought against Citizens property insurance, claims the company used a software program that inflates the replacement value of a home in order to charge customers higher rates.  FAIR’s regional director David Welch calls a back-door tax on property owners.

 “They’ve done that by coming in and saying, hey folks, the property appraiser says your house is worth $70,000. We say your house is worth $140,000. So we’re going to charge you the rates for that $140,000.”

 Last year the legislature refused a plan to allow Citizen’s to raise rates by 2,000- percent. The lawsuit claims the property insurer went out and purchased software called 360 value – allowing them to skirt the competitive bidding process and providing an alternative way to raise rates. A spokeswoman for Citizens says it has no reason to over-insure policy holders. 

Follow @HatterLynn

Lynn Hatter is a Florida A&M University graduate with a bachelor’s degree in journalism. Lynn has served as reporter/producer for WFSU since 2007 with education and health care issues as her key coverage areas.  She is an award-winning member of the Capital Press Corps and has participated in the NPR Kaiser Health News Reporting Partnership and NPR Education Initiative. 

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