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Board members of Citizens Property Insurance Co., Florida’s insurer of last resort, voted during a meeting on Tuesday to put “effective” rates of commission in personal lines at 7 percent, up from about 5.8 percent; 10 percent in personal lines, wind-only, up from about 8.9 percent; and 12 percent in both commercial residential and wind only accounts, up from 10 percent.

According to the Florida Association of Insurance Agents, FAIA was the only insurance association present at the meetings. After a brief presentation on the cost/benefit ratio of certain changes tied to the commission increase, during a meeting chaired by Ed London, vice chairman, board members voted unanimously to increase the rates.

All rates apply to new and renewal business and are effective as follows:

• Personal Lines multi-peril–7.0 percent; effective 9/1/05 new; 11/1/05 renewal;

• Personal Lines wind only–10 percent; effective 9/1/05 new and renewal;

• Commercial residential multi-peril–12 percent; effective7/1/05 new and renewal; and

• Commercial wind only–12 percent; effective 9/1/05 new and renewal.

This increase in commission percentage comes on the heels of substantial statewide rate increases (commercial & personal lines) that in some territories increased premiums by more than 100 percent.

FAIA said this change will save millions for consumers because Citizens is moving to use agents to help improve its service levels recognizing that it is, for many, the market of “only” resort for property coverage and isn’t likely to ever go out of business. It needs to “reduce” the number of appointed agents (now at 7,700) to operate efficiently, it needs to involve agents in issuing non-premium bearing endorsements and in participating more in claims settlement, particularly with ALE draft authority and more.

“But, we believe the staff and board of Citizens now recognize that agents are not the ones responsible for its high population and that you can be partners in trimming its expenses, keeping out policies, and providing good service,” FAIA said.