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TALLAHASSEE (CBS4) ― More work still needs to be done to fulfill a promise by Governor Charlie Crist to lower property insurance premiums.

Several insurers have filed their proposed new rates, and instead of a decrease, many requested an increase. For example, the Florida Farm Bureau has requested an average increase of 30-percent, a 94.8 percent increase was requested by Sentry Insurance and a 53.9 percent rate hike from USAA, which insures military families.

State officials had promised rates would drop about 25 percent on average because of a new law allowing insurers to buy cheaper state-backed reinsurance which provides them backup coverage against having to pay out lots of claims. The law required insurers to pass on those savings to customers.

State Farm, the second largest home insurer in the state, proposed to drop rates by about 7 percent on average. But state regulators told the company to try again. Insurance Commissioner Kevin McCarty said the company's decrease should be closer to 11 percent. No increase has been approved yet and McCarty suggested many may not be. His office already rejected the Farm Bureau increase.

"We fully expect the companies to provide the rate relief anticipated by the Legislature," McCarty said.

Those savings were also anticipated by homeowners, many of whom say they are yet to see any help. A recent survey found about half those polled expected bigger savings. Most certainly didn't expect to get higher bills.

"I thought they'd at least hold steady," said Earl Lunsford, who was disheartened when he received his renewal notice for a policy he has had with Nationwide since he built his house 43 years ago. The rates did not hold steady: he said his annual premium is increasing from $2,600 to $3,700.

"I'm well away from the water too, from the Gulf I'm about 25 miles like the crow flies," said Lunsford, who lives in the Panhandle town of Milton.

"It kind of makes you want to move," said Lunsford, who is retired after a 35 year career with Monsanto Chemical. "I could go to Alabama, and I'm seriously considering it."

McCarty, Crist and other officials say some insurance companies are not doing what they were required to by the law. Some, like state Chief Financial Officer Alex Sink, are particularly miffed that the state took on extra risk to try to make the rates come down. Taxpayers are now on the hook for that.

"We put this state out for extra exposure with the thought that we were going to be able to give our citizens a 28 percent rate decrease and it hasn't happened," Sink said. "I think the people of Florida are owed an in-depth explanation."

Insurers say they must have cash on hand to pay out claims from big storms. And they argue they never guaranteed the savings state officials promised and tried to tone down expectations.

"Most insurers made no specific promises," said Sam Miller, a spokesman for the Florida Insurance Council, which represents several insurers. "In fact, insurers repeatedly sounded a note of caution about the real world impact of the law on policyholder premiums, so as not to raise unrealistic expectations."

State Farm was one of the companies that from the beginning publicly questioned the state's assertion that there would be cuts of more than 20 percent for many homeowners. Company officials said during legislative debate in January that State Farm would likely file for a decrease of about 7 percent. It recently asked for a 7.1 percent drop.

"We promised and we delivered, so there's no game going on here," said Mark Delegal, a lobbyist for the company.

Ultimately, insurers say they must charge what they think they would need for claims if Florida has another run like 2004 and 2005 when they paid out nearly $40 billion for hurricane damage.

"When the wind blows and the damage is caused, (companies) are obligated to pay the loss," Delegal said. "Our contract says if the damage is caused by a hurricane, we pay it. What we do as an industry, and as a company, is make sure we're financially able to make good on our contractual obligations."

McCarty accused some companies of using savings from buying cheaper state-backed reinsurance to either pad their shareholders' bottom line or buy additional private reinsurance. That may be illegal, he said, because the law specifically requires companies to use savings for premium decreases.

"It was a courageous, bold move by the Legislature to put $12 billion of additional capital into the marketplace," McCarty said.
"Now we've got to make sure that that goes to the policyholders and not to the stockholders."

Lawmakers have also expressed disappointment, but some have noted that giant premium increases, where rates have more than doubled in a single year, haven't happened like they did before the new law.

The legislation "was a good first step, simply because every other step was in the wrong direction," said House Democratic Leader Dan Gelber, D-Miami Beach. "We clearly haven't done enough."

Crist has acknowledged that he's disappointed with the law he trumpeted as one that definitely would make rates drop. But he blamed the companies and vowed to keep fighting to bring rates down.

(© 2007 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)