Gallagher Re’s annual Florida Market Watch Report for the year ending 2023 highlights the state of the insurance landscape in Florida, focusing on companies with a significant presence in the state’s personal property market.
The report, drawing data from NAIC statutory statements via S&P Global Market Intelligence, outlines various metrics of performance, including premium growth, profitability, surplus, new company formations, and policy take-outs.
In terms of premiums, 2023 saw an overall increase across all subgroups compared to the previous year. The ANTS subgroup, which includes major insurers like Allstate (Castle Key companies), Nationwide, Travelers (First Floridian), and State Farm, experienced 19% growth in direct premium written (DPW), reaching $2 billion.
This surge was largely attributed to State Farm. The Florida Specialists subgroup witnessed a 15% increase in DPW, amounting to $22.7 billion, with American Strategic and Privilege Underwriters driving much of this growth.
Furthermore, Citizens, the state-run insurer, reported a notable 59% increase in DPW to $5.1 billion in 2023, fueled by an uptick in policies in force.
On the profitability front, 28 out of the 57 companies monitored reported underwriting gains in 2023, an improvement from 15 companies in 2022. Despite this, the Florida Specialists subgroup faced a net underwriting loss of $398.3 million and an after-tax net loss of $9.5 million.
Conversely, the ANTS subgroup achieved a modest net underwriting gain of $0.6 million and an after-tax net income of $24 million.
Overall, the market’s net underwriting income stood at $68.8 million, with after-tax net income at $760.9 million—largely contributed by Citizens with an after-tax net income of $746.5 million. The combined ratio for the market also improved markedly to 96.7% in 2023 from 133.9% in 2022.
The report also highlighted 15.6% growth in policyholders’ surplus across the market to $12.2 billion in 2023. Notably, Citizens’ surplus rose by 17.4% to $5 billion, and the Florida Specialists’ surplus increased by 16.7% to $6.1 billion, with net additions including capital inflows and surplus notes totaling $865.7 million.
Regarding new market entrants, the Florida Office of Insurance Regulation approved five new companies for 2024, aiming to diversify the state’s property insurance options.
Additionally, the take-out process saw significant activity in 2023, with 646,617 policies approved for removal from Citizens, highlighting efforts to redistribute policies to the private market and reduce the state insurer’s exposure.
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