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Excessive Homeowners Insurance Increase Denied by Insurance Commissioner

Date Posted: Monday, March 13th, 2017
Categories:  Insurance Commissioner

DOVER, DE – A request by Windsor-Mount Joy Mutual Insurance Company (“WNMJ”) to increase insurance rates on over 2,000 manufactured housing policyholders by 20%-30% has been denied by Insurance Commissioner Trinidad Navarro. Many of these homeowners have already received premium increase notices from WNMJ effective March 15, 2017. Because of the Insurance Commissioner’s denial, those increases will not go into effect. For reasons set forth in his order, Commissioner Navarro has deemed the request excessive and unreasonable.

WNMJ’s requested increase would unfairly impact manufactured homeowners in one geographic region-Eastern Sussex County. After reviewing the request, Commissioner Navarro found the request to be unreasonable. The Department of Insurance subsequently hired an independent actuary to determine the fairness of the requested rate increase. After reviewing 1 0 years of claims files for the company, the Department contracted actuary concluded that this area, receiving the largest proposed increase, is also the area that has had the fewest claims. The company’s cost for reinsurance and brokerage fees were also indicated as being higher than the industry average.

In response, Commissioner Navarro issued the following statement:

“As Insurance Commissioner, it is my duty to look out for and protect consumers. After our analysis, we believe it is unfair for a company to pass on its negotiable reinsurance costs and negotiable brokerage fees to its policyholders by increasing their rates.

At this point, there are several routes we can take. WNMJ can either negotiate a better rate for consumers, or file for a public hearing on this matter. That decision will be forthcoming.

When I ran for this position, I promised to thoroughly review and deny any requests for rate increases that I deem to be excessive. I have already negotiated lower rate increases in other cases, however, this is the first that I have had to outright deny. In the future, I will not hesitate to apply strict standards and scrutiny to any rate filing. I will also continue to deny any request for rate increase that I find excessive.”

View PDF (see page 2 of 2): windsor-mt-joy-rate-denial

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Contact: Vince Ryan

Office: 302-674-7303

Mobile: 302-387-7670

vince.ryan@state.de.us

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