ORLANDO, Fla. – Once viewed as the insurer of last resort, Citizens Property Insurance Corporation has experienced an unprecedented surge in popularity amidst Florida’s property insurance crisis.
As rates soared, this state-backed carrier amassed a staggering 1.25 million active policies. Now, however, that number is about to be halved as the state rolls out a depopulation initiative.
More than 648,000 Citizens policies are slated for transfer to private insurers, a move authorized by Florida lawmakers in December 2022 during a special legislative session.
“Being with a private company is always a better option than being with a government insurance company,” said Lisa Miller, Florida’s former insurance commissioner.
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As this depopulation program rolls out, homeowners will receive notices indicating which private carrier is taking over their policy. The phrase “buyer beware” rings truer than ever as policyholders are urged to read the fine print and assess the new terms carefully with their respective agents.
“Every customer has an insurance agent,” Miller advises. “They are the front lines for these policyholders.”
News 6 spoke with Bob Ritchie, president and CEO of American Integrity Insurance, one of the dozen private carriers stepping in to assume Citizens’ policies.
“We’re slowly getting back on our feet,” Ritchie explains, noting that his company is taking on more than 140,000 policies from Citizens. “We felt it was very appropriate for us as a market leader to participate in that effort.”
For homeowners transitioning from Citizens, an increase in premiums is likely. State law caps this hike at 20%, but many are left wondering how to manage these costs in a climate where the average annual premium for homeowners’ insurance in Florida has skyrocketed to $10,996 — four times the national average, according to Insurify.
Ritchie assures policyholders, “There is no scenario where we give you a teaser rate and then we renew it substantially higher. Our website, our call center, our outreach is here to try to explain this because no one wants to pay more than they have to for insurance.”
The situation has prompted some homeowners to consider the risky maneuver of “going bare,” or dropping insurance altogether. According to the Insurance Information Institute, 15% to 20% of Floridians have made this choice, leaving them exposed to financial ruin should disaster strike. For those with mortgages, this is typically not an option.
So, how can homeowners lower their sky-high premiums amid this upheaval? Ritchie offers three pragmatic tips:
- Adjust your coverage: Tailoring your policy to match your needs can prevent over-insurance.
- Increase your deductible: A higher deductible may reduce your premium but requires careful financial consideration.
- Ensure your insurance to value is correct: Making sure your home is accurately valued can prevent unnecessary overcharges.
“These are just three simple things,” Ritchie explains. “You add one or two of those up, and you could begin to save hundreds of dollars.”
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