Florida

Approval of thousands of property insurance policies taken from Citizens means ‘good news’ for Florida, experts say

Florida property insurance experts say the approval of four insurance companies to take as many as 125,000 policies from Citizens Property Insurance is another sign the state is headed in the right direction.

During a special legislative session held earlier this year, state leaders said one of their main priorities was to move policies from the state-backed insurance company Citizens citing the financial risks of a major hurricane.

Fast forward to today — when we are almost through the 2023 hurricane season — property insurance experts say Florida appears to be on a path to making a recovery.

“The good news is private companies want to take on more policyholders, something we did not see for several years here in Florida,” said Insurance Information Institute Spokesman Mark Friedlander.

RELATED | Florida’s property insurance market sees more competition which is leading to lower rates for some

Friedlander is talking about 125,000 insurance policies that will be removed from Citizens Property Insurance in Jan. 2024.

According to Citizens’ website, they currently have roughly 1.33 million policies, a number that’s down from 1.412 million policies earlier in the month of October.

Insurance experts say the more policies get offloaded from Citizens, the less the financial risk for the rest of the state. To date, there have been four significant phases of depopulation.

“Right, both the November and December programs will potentially move several 100,000 policyholders back to the private market. But if we look back at the data from October, there were roughly 300,000 policyholders available for takeout in October, and about a third of those are moving back to the private market. So roughly one in three,” Friedlander said.

Insurance agents said the key factor in whether a policyholder moves to the private market or not, is the takeout offer from the private company, and how much it costs. If the offer from the private company is within 20% of what you are currently paying Citizens, you have to accept the offer or find another policy.

But if it’s over 20% you can decline and stay with Citizens.

MORE | Citizens Property Insurance policyholders get letters in the mail asking them to switch

Friedlander said the current rate of depopulation from Citizens is a hopeful sign that Florida is on the path to stability.

“It’s getting better and every day, it’s getting better. And the good news is this hurricane season, in terms of significant losses for insurers, is mild compared to last year. We had hurricane Ian, one of the worst on record in the US in terms of insured losses, much smaller damage claims is here from Idalia, because [it] hit a sparse area of Florida, not a big impact compared to Ian in southwest Florida,” Friedlander said.

Friedlander said the current rate of Citizens’ depopulation also makes it less likely that Floridians would have to pay what’s called a hurricane tax, which is where every Florida consumer would be on the hook to pay Citizens insurance claims after a major hurricane or storm.

Copyright 2023 by WJXT News4JAX – All rights reserved.

https://www.news4jax.com/news/local/2023/11/01/approval-of-thousands-of-property-insurance-policies-taken-from-citizens-means-good-news-for-florida-experts-say/ Approval of thousands of property insurance policies taken from Citizens means ‘good news’ for Florida, experts say

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