RLI Insurance Wants 16% Florida Rate Increase For Umbrella, Filing Shows

In early August, Florida’s insurance commissioner noted that rate increases by the state’s property-casualty insurers have slowed significantly since the 2023 legislative reforms were passed, with 12 carriers asking for a small decrease this year and another two dozen filing requests for a zero rate increase.

RLI Insurance, a specialty insurer serving niche markets, does not appear to be following this trend. The Illinois-based carrier, licensed in Florida since 1975, will raise rates on personal umbrella policies, including uninsured motorist coverage, by an average of 16 percent starting Sept. 1, a usage and registration rate filing with OIR shows.

More than 57,000 policies may be affected.

The increase is on top of a 24 percent increase that was approved and went into effect in January, meaning new or renewal policies with a start date after September will see both increases, said RLI Florida Administrator Charlie Hampton , in a statement from Florida. Insurance Agents Association blog post this week.

“I’m sure (agents) won’t like it, but they will understand in this market,” she said in an email Friday.

The RLI has also been approved for a 13.8% increase in June 2023.

Officials with publicly traded RLI could not be reached for comment Friday morning.

The company, which began as a contact lens insurer in 1965, has continued to be profitable in recent years. RLI’s Q2 earnings report shows net income of nearly $82 million, up slightly from Q2 2023. Its combined ratio, a measure of profitability, was a shockingly low 81.5, a slight improvement compared to the previous year and well below the industry average.

RLI’s stock price rose to an all-time high of $154 per share last week and this week, Investing.com and Yahoo!Finance reported.

While Florida regulators recently pushed for rate moderation, RLI isn’t alone in asking for double-digit increases this year as the Florida market recovers from what insurers have called extreme litigation costs — before the new statutes to enter into force in 2022 and 2023.

Other carriers include People’s Trust Insurance, which requested a 14.8 percent increase in home fire policies; First Protective Insurance, which requested a 14.7 percent increase for homeowners; and Cypress Property & Casualty Insurance, which was approved for an 18.7 percent increase in homeowners policies. Citizens Property Insurance Corp. it also called for an average rate increase of 14 percent, the maximum allowed by the corporation’s glide path.

So it is not certain that RLI’s latest filing will be approved. At a rate hearing in June, OIR officials repeatedly questioned a People’s Trust executive about the company’s HO rate increase coming on the heels of another increase in 2023, Lisa Miller & Associates reported.

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Price trends in Florida