Florida pushes hurricane risk to private sector

It may still be largest property insurer in state, but the state-owner player has downsized its portfolio by 73% over the last 3 years

Insurance News

By Lyle Adriano

Citizens Property Insurance Corporation’s portfolio in Central Florida dropped to 20,644 policyholders in September, reflecting the state insurer’s ongoing plans of reducing its risk to taxpayers should another devastating hurricane strike.

In 2012, Citizens had 77,028 residential policies in Central Florida. Since then, the figure has dropped by a significant 73%.

Although Citizens is reducing its customers, and Florida has not been struck by a major storm in the past ten years, the insurer will still make itself available to homeowners and businesses that private insurers will not cover.

For those homeowners with properties of advanced age or poor condition, Citizens might be their only choice for insurance coverage. Those with coastal homes in Brevard and Volusia counties which are at high risk of hurricane damage will often have no other choice for insurance than Citizens.

The corporation began offering policies with more restrictive coverage and even lesser options than those of private companies, in an effort to dissuade consumers from purchasing from them and move to private insurers.

The Office of Insurance Regulation approved in September new rates for 2016 that will be mostly lower than this year’s for inland locations, while increasing rates for coastal areas and South Florida. Homeowners still signed to Citizens do not have to change unless a private company offers premiums that are either the same or less. On the other hand, new homeowners must accept a private insurer if its premiums are up to 15% higher than Citizens’.
 

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