Citizens Property Insurance removed more policies
More than 30,000 homeowners insurance policies have been removed from Florida’s Citizens Property Insurance. These policies were removed as depopulation efforts continue by the insurer. These efforts are meant to reduce the overall number of policies that Citizens is responsible for, thereby reducing its financial responsibilities and making the insurer more sustainable in the future. The depopulation was sparked by serious issues the insurer faced in the wake of serious natural disasters that it did not have the financial capability to handle on its own.
Private insurers are taking up coverage shed by Citizens
The policies shed by Citizens will be taken up by private companies. Heritage Property & Casualty Insurance will be taking up 20,000 personal residential policies and 50 commercial residential properties. Southern Oak Insurance will be taking the remaining 10,000 policies shed by Citizens. These companies will honor the terms established by Citizens’ homeowners insurance policies, but may make some changes to these policies when they are renewed by their owners in the future.
State-run insurer continues to recover from its financial problems
Citizens Property Insurance was first established in 2002 as a way to provide homeowners insurance coverage to those living in Florida. Many homeowners were unable to find affordable coverage in the private market because of the risks associated with living in the state. Though the state-run insurer was considered as a “last resort” for those looking for coverage, homeowners flocked to the insurer in order to find the protection that they need. In the wake of several severe natural disasters, however, the insurer suffered financial losses that proved difficult to recover from, which lead to a depopulation effort involving moving policies to private insurers.
Homeowners insurance coverage is becoming more expensive
Since the depopulation effort began, Citizens has shed some 632,286 policies. So far this year, 110,529 policies have been moved from Citizens to private insurance companies. The homeowners insurance sector in Florida has experienced a modest shift as a result of this, with rates on the rise for many people living in coastal areas. Rising insurance rates in these areas are also linked to growing flood insurance premiums.