Cris Home Inspections

Tens of thousands of Florida homeowners are receiving offers to switch from the state's insurer of last resort to private companies, as regulators' efforts to depopulate Citizens and stabilize the Sunshine State's property insurance market continue.

The takeout offers, which involve more than 130,000 homeowners, are for three private companies—Slide, Patriot and Mangrove. Newsweek contacted the press teams of these three insurers for comment by email on Tuesday morning, outside of standard working hours.

Why It Matters
Florida has just started recovering from a yearslong crisis that has seen home insurance premiums skyrocketing due to a combination of widespread fraud, excessive litigation, and the increased risk posed by natural disasters, made more frequent and more severe by climate change.

Between 2019 and 2023, the average homeowner premium in the Sunshine State surged by nearly 60 percent, Reuters reported, as several major insurers reduced coverage in the most-vulnerable parts of the state or withdrew from it entirely.

The lack of affordable options on the market forced thousands of homeowners to join the ranks of Citizens, which ballooned in size to reach a record of 1.4 million policies in 2023. The sudden growth of the state-backed insurer of last resort caused concern among regulators and lawmakers, who ordered Citizens to lower its total policy count out of fear that all Floridians would risk having to bail out the company.

Should the state be hit by a disastrous extreme weather event, for example, all Florida homeowners could face extra charges to cover for Citizens if the insurer were not to have enough money to cover claims.

What To Know
Since 2023, Citizens has successfully transferred thousands of policyholders to private companies in a process known as "depopulation." Currently, Florida's insurer of last resort has 850,000 policies—its lowest total in nearly three years.

This number is expected to continue dropping as more private companies are allowed by state regulators to take over Citizens' policies. Florida Insurance Commissioner Michael Yaworsky signed three orders allowing Slide, Patriot, and Mangrove to assume as many as 135,540 policies from the state's insurer of last resort.

February assumption figures show that the Florida Office of Insurance Regulation (OIR) gave approval for companies to assume 342,918 policies from Citizens, and 209,164 offers went out. By the end of the process, 102,083 policies were assumed by the takeout companies.

That suggests that not as many policies as approved by OIR will actually be assumed by private companies.

Florida homeowners fear soaring insurance cost after hurricanes.

For 32 years, Jim Tynan had a homeowners' policy with Allstate on his 1,200-square foot condo in Ponte Vedra, Florida. In January, Tynan's Allstate subsidiary told him it was going to drop him. Tynan called ten different agencies, "and none would cover me," he said.
Finally, he found one that would. It cost 50% more.
Florida has been hit with four major hurricanes in the past four years, which has sent insurance premiums rocketing and caused some insurers to pull back on coverage. For residents cleaning up after storms or living nearby water, they have another worry: Will they still have insurance?
Tynan said he has not been hit directly by a hurricane but is two miles from the ocean. "I live in fear I will get a letter from my new company telling me they are going to drop me, too," said Tynan, speaking after the latest hurricane. "It's very scary."
Six other homeowners contacted by Reuters in areas including both Florida coasts and the Keys also said they were worried that the back-to-back hurricanes would result in more price hikes and exclusions. Worse, they feared they could lose their insurance altogether. Allstate said it worked with regulators to protect as many customers as possible. For those that it cannot cover, "We work with other carriers to offer alternative coverage offerings."
A number of homeowners in Florida have faced a precarious situation for securing insurance. Average homeowner premiums in Florida surged nearly 60% between 2019 and 2023. Some major insurance providers have reduced coverage. The state insurer, Citizens, meanwhile has taken on increased business. Analysts and insurance experts predict more nervousness about insurers following Hurricane Milton, which made landfall on Florida's Southwest coast just 12 days after Hurricane Helene made landfall on Florida's Northwest coast.
"This is ...certainly going to cause insurers to be concerned about continuing to insure in the market," said Marc Ragin, associate professor of risk management and insurance in the Terry College of Business at the University of Georgia. The increased hurricanes could increase reliance on the state-backed nonprofit insurer Citizens, considered the insurer of last resort.
Florida's Governor Ron DeSantis has in the past raised questions about how the insurer could pay claims if large storms hit. Citizens spokesperson Michael Peltier said it would always be able to pay as it was structured to first levy surcharges on policyholders and then, if needed, assessments on non-policyholders. He said about 80,000 claims came in so far related to Milton and it expected to be able to pay them all without having to levy assessments on non-Citizens policyholders.

https://www.wptv.com/money/real-estate-news/8-new-property-insurance-companies-approved-to-enter-florida-market

8 new property insurance companies approved to enter Florida market Eight new insurance companies will now be able to enter the state and begin writing homeowners insurance policies.