UPDATE 3-Cincinnati Financial subpoenaed by Florida

(Recasts, adds company quotes, further background)

By Ed Leefeldt

NEW YORK, Sept 20 (Reuters) - Cincinnati Financial Corp (CINF.O) said on Thursday it was the latest insurer to be hit by subpoenas from Florida officials angry that homeowners have not gotten enough relief from insurance costs.

The Midwestern property and casualty insurer said it would fight the subpoenas, which demand its communications with insurance trade organizations, rating agencies and risk modeling companies going back several years - and requires them by Sept. 24.

The Fairfield, Ohio-based company would also have to testify at a public hearing on Oct. 18.

James Benoski, chief executive of the two insurance units subject to the subpoenas, called them "overly broad and burdensome" and said in a statement they would lead to a public airing of private policyholder information.

The insurer, with only 15,000 Florida customers, is not the first to face a subpoena from the state's Office of Insurance Regulation. State Farm, the largest U.S. home insurer with over a million customers in the state, has also been subpoenaed and faces a Nov. 14 hearing.

"We are ready for this," said State Farm spokesman Phil Supple in an interview.

COLLUSION DENIED

Benoski said he was aware of statements by Florida public officials speculating on whether the industry had "acted in concert" to drive up the price of homeowners insurance in Florida.

"We certainly have not participated in or benefited from any such activity," he said.

A spokesman for the Florida insurance regulator said he could not comment on issues that were under investigation.

Earlier this year, the Florida legislature authorized an increase in the state's reinsurance fund in order to lower rates.

Reinsurance provides insurers with a backup in case of major catastrophes that would otherwise wipe them out. In 2004 and 2005, Florida's hurricanes cost insurers more than $36 billion in claims.

The increase in the state's reinsurance fund was supposed to enable insurers to draw on it and lower property insurance rates by 24 percent. The final "true-up" of rates will not be completed until early October, but Florida media reports have said it appears rates have declined only about 12 percent, after almost doubling last year in some coastal areas.

Cincinnati Financial recently requested a 37.5 percent rate increase, after initially lowering rates 35 percent earlier this year, Florida regulators have said. The subpoenas come two days after a public hearing in Florida's capital, Tallahassee, on Cincinnati Financial's rates.

Cincinnati Financial said it had filed a petition in Florida state court aiming to narrow the scope of the subpoenas and seeking a protective order.

Cincinnati Financial shares fell 85 cents, or 1.9 percent, to close at $43.54 on Nasdaq. (Additional reporting by Christian Plumb)