Posted on April 18, 2015 - 02:20 PM
by Paul Brenot
TALLAHASSEE, Fla. – March 19, 2015 – Florida-owned Citizens Property Insurance Corp. President and CEO Barry Gilway announced that the company's policies have fallen to 598,000, – the lowest number since Citizens was formed in 2002. In addition, further reductions are expected in 2015.
Florida's private homeowner's insurance market has improved in recent years, and Citizens has actively moved to cut down, or depopulate, the number of its policies. It has also boosted its ability to cover homeowners after a major disaster by purchasing additional reinsurance, which is more affordable.
Florida has not had a major hurricane or storm impact it since 2005.
A state-created clearinghouse for the depopulation of Citizens became operational in 2014, and it compares the cost of Citizen coverage against that of private insurers. As a result, 389,750 policies have been taken out of Citizens through February 2015, according to the insurer of last resort.
Gilway says that if 2015 is another storm-free season, Citizens could shrink even more – to 450,000 policies.
The Florida Office of Insurance Regulation (OIR) most recently approved 48,000 policies for removal by private market insurers, though the ultimate number of policies removed could be smaller as consumers can opt out of the change. The OIR also said that private insurers in the state would no longer collect a 1 percent emergency assessment on property premiums after July 1, two years ahead of its planned 2017 sunset.
State Insurance Commissioner Kevin McCarty said recently that Citizens is entering the 2015 hurricane season with more than $4 billion in reinsurance coverage and a surplus of about $7.5 billion.