Florida regulators have given the nod to three insurers’ proposals to take up to 54,386 policies from the state’s beleaguered Citizens Property Insurance Corp. in May.
The policies will be split between Slide Insurance Co. (up to 25,000 policies), American Integrity Insurance Co. of Florida (up to 19,386), and Security First Insurance Co. (up to 10,000), according to a report by Tampa’s WMNF Radio.
The approvals are part of Citizens’ “depopulation” program, an effort to move policies to private insurers.
Citizens, Florida’s “insurer of last resort,” was formed in 2002 to provide windstorm and property coverage to state residents who could not obtain it elsewhere.
But over the past three years, as private insurers have dropped customers and hiked rates, Citizens has become the state’s largest property insurer, WMNF reported.
Florida insurance premiums have skyrocketed over the last five years. At an average of $6,000 per year, they are currently the nation’s highest.
This has led to pressure on Citizens – and an investigation by the federal government into the insurer’s financial stability. Florida’s Republican governor, Ron DeSantis, said in a recent CNBC interview that the state-backed insurer was “not solvent” and could be in trouble if a storm hit.
Citizens CEO Tim Cerio said in January that the company had $4.5 billion cash on hand and would be able to pay claims. However, he said the goal was for Citizens to “shrink back to that true insurer of last resort.”
Citizens had as many as 1.412 million policies in autumn of last year before it began shedding customers through the depopulation effort, WMNF reported. As of last month, the company had about 1.164 million policies.
Of the three insurers who have agreed to take up policies, Slide is no stranger to stepping in for troubled Florida carriers. Last year, the company bought exclusive renewal rights for 91,400 Florida homeowners policies from UPC as that insurer ran off its business in the state after it faced an estimated $1 billion loss from Hurricane Ian.
In 2022, Slide picked up policies from Orlando-based St Johns Insurance when that company was placed into receivership.
American Integrity, meanwhile, specializes in Florida and South Carolina home insurance. The company purchases enough reinsurance to pay claims from storms of the magnitude of 1992’s Hurricane Andrew, according to its website.
Security First is one of the largest homeowners insurance companies in Florida. Security First said on its website that it could cover an event more than 4.5 times the cost to the company of hurricanes Irma or Ian.
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