Changes to Florida laws — including a provision making it harder for policyholders to sue insurance companies — are working as intended to help bring the state’s property-insurance market “back from the brink of collapse,” the head of Citizens Property Insurance Corp. said Wednesday.
Despite three catastrophic hurricanes hitting the state this year, Florida’s property-insurance market “continues to recover,” Citizens President and CEO Tim Cerio told the state-backed insurer’s board of directors Wednesday.
“The reforms passed by the legislature, it’s not an understatement to say they really brought the insurance market back from the brink of collapse. They are continuing to work, which is great news for all Floridians,” Cerio said.
Lawmakers in 2022 and 2023 passed a series of measures aimed at stabilizing the state’s insurance market as insurance companies fled the state and policyholders saw premiums skyrocket. Among the changes was a measure that made it more difficult for homeowners to sue insurers over claim disputes, an effort lawmakers said was necessary to curb litigation by bad actors.
According to a report Cerio provided to the board of directors Wednesday, 15 insurance companies have made a total of 22 filings for rate decreases and 29 companies have made 42 filings for a zero percent increase this year. Most companies also paid less for reinsurance this year than they did in 2023.
“After years of consecutive underwriting losses, the insurers saw overall stability with many companies reporting a net profit in 2023,” Cerio’s report said.
Cerio also said efforts to “depopulate” Citizens by shifting polices to private insurers are exceeding expectations. The depopulation program is a key strategy as state leaders try to shrink Citizens, which in recent years became Florida’s largest property insurer because of financial problems in the private market.
“We think we are going to end the year at only 369,000 new policies, which is 30 percent below what we forecast. So, because the market is getting healthier, we are seeing less new business come in,” Cerio said. “We’re certainly moving in the right direction.”
The number of Floridians insured by Citizens fell below 1 million last month and is expected to drop to 907,000 by the end of the year, according to the state-backed insurer’s website.
Citizens, which was created as an insurer of last resort, reached as many as 1.412 million policies last year before seeing the number reduced because of earlier depopulation rounds. State leaders want to minimize the number of policies in Citizens, at least in part because of financial risks if the state gets hit by a major hurricane or multiple hurricanes. If Citizens wouldn’t have enough money to pay claims, policyholders throughout the state — including possibly non-Citizens policyholders — could have to pay what are known as “assessments” to cover the costs.
Cerio said Wednesday that the majority of policies being moved to private insurers were in Broward, Miami-Dade, Palm Beach, Hillsborough and Pinellas counties.
“These are areas that were typically avoided by takeout companies because of high litigation rates, so the companies continue to have an appetite because of the positive results they’re seeing from the reforms,” he added.
Depopulation “has been a tremendous focus for me and my team and for this board, for a good reason,” Cerio said.
“We should not be competing with the private market. And frankly, a smaller Citizens means less exposure, the chances that non-Citizens policyholders get hit with an assessment,” Cerio said, giving credit to Gov. Ron DeSantis and Chief Financial Officer Jimmy Patronis for the legislative changes. “I was not overstating things when I said the reforms championed by the governor and the CFO brought us back from the brink.”
Citizens thus far has paid more than $516 million to settle combined property claims after Hurricanes Debby, Helene and Milton, with Milton payments exceeding $435 million. Citizens also paid more than $52.6 million in expenses to policyholders impacted by the storms, according to Cerio’s report.
Some claims can be closed without payment for a variety of reasons. As an example, Citizens covers damages caused by wind — not storm surge. Also, Citizens policyholders who submitted claims but did not meet their deductible might not receive a payment, Cerio said.
“It’s critical to just point out that we are the state-created, not for profit, insurer of last resort. We have no financial incentive to not pay claims. Zero. In fact, I would argue that … we have every incentive to pay valid claims to our policyholders as promptly as possible,” he said.
Kat says
I sense that there is more to the story here. Did limiting policyholder rights to sue means that the consumer has little to no recourse if the insurance adjuster comes back with a lowball figure? I believe there were a lot of issues with people claiming roof damage and trying to get their insurer to cover a new roof and then there were lots of insurance companies dropping people if their roof was of a certain age, even if there were no problems. All I know from a personal perspective is that when we have had wind or flooding claims (2004, 2016-Hurricanes and 2020-burst pipe in wall) the Insurers covered was only a fraction of the cost we incurred or of our monetary losses.
Jim says
As much as I’d like to believe this article, I just have too many reservations to do so. The last report I saw on claims accepted vs. rejected due to the three hurricanes was 1:4 meaning four rejected out of every five. If I’m wrong someone please correct me. My point is that if you are rejecting 80% of the claims, odds are you are probably doing much better financially (i.e., “rebounding”).
As an insured homeowner, I don’t know if I can take much solace in knowing that – should I need to make a claim – there’s an 80% chance the insurance company will reject me! I don’t know how that’s supposed to make me feel better. I guess since most of the insurers seem to be either proposing reducing rates or holding steady, I can be happy that my insurance likely won’t go up so when my claim does get rejected, I didn’t pay any more than the last time!
Happy times!
Alam lefstead says
Have you ever noticed that insurance companies have the tallest sky scrapers in many cities?
Deborah Coffey says
Gotta love the way Republicans tout their laws while we are all paying much more for house insurance and lots of people affected by storms get a fraction of what adjusters say is needed. What BS!
Ed P says
The changes were necessary because some insurance is better than none. It’s that simple. If insurance companies face regulations that prevent them from profiting, they leave a market. Last year 7 insurers left the market due to insolvency. Other national carriers dropped or quit writing new policies.
Yes, premiums are sky high. Homeowners were dropped and flocked to the state backed Citizens..
Take heart, with these changes help is on the way. Here are 3 names of insurers that probably will save you premium dollars. Kin insurance who is an admitted carrier since 2016 in Florida and Orion 180 and Sure who are entering the market in January and are non admitted. Basically, an admitted carrier is backed by an agency in the event of a catastrophic situation that forces them into bankruptcy so all claims are paid in a timely fashion. However, that doesn’t mean one is better or that they are not regulated. You need to find your comfort level.
I’m am not a broker or involved in the industry but spent countless hours scouring data to find affordable as well as secure homeowners insurance for myself. I should point out that your credit score and any claims record on your property will affect your rates. If you don’t have a wind mitigation report, you could save thousands if you perform one and it meets the 2010 Miami Dade County guidelines. Also a current elevation certificate will be required.
If you can afford to, raise your hurricane deductibles to a level you can live with in the event of a claim and resist filling claims for smaller non consequential damages, both will allow premiums to be reduced.
Standard homeowners cover may also provide you with a personal property coverage amount that would be astronomically high given depreciation and your life style. See if reducing it down saves enough premiums that it’s worthwhile.
FYI…..no skin in the game
Deborah Coffey says
OMG, Ed. Here you go again…trying to reason your way into believing everything is just fine as long as Republicans are doing it. Notice you’ve not one “like.”
Jerry says
You are “right on” Deborah. Unfortunately, with climate change only beginning to clobber this and many other states and planetary locales, “humanity” has very little to look forward to. In no way will any insurer or other financial entity agree to take on risks that are unavoidable. More than likely, property insurance, as a profitable business will in time, cease to exist.
Laurel says
Uh huh. Good ole DeSantis saved the day, right?
What is not mentioned here is the number of people the private insurance companies are not paying for damage. Many have to pay for mortgages, and rent, while awaiting insurance to pay. People have to sue to get paid, while big insurance can wait them out. Good ole DeSantis made it harder to sue insurance companies, so suck it up. Walk away if you have to. Maybe sell your property for dirt.
What is also not mentioned here is how private insurance decides what is flood damage and what is not. Flood pays up to four feet within your damaged house. Anything above four feet is your problem. We know a couple who got their lower cabinets replaced and nothing above the counter top, and believe me, these people knew what they were doing. They had spreadsheets to provide to the insurance company. Insurance companies say that flooding occurs from the ground up. Any damage from excessive rain is your problem. Four feet up from the ground, no matter what the actual damage is. We have seen many houses that were completely flooded inside. No matter, DeSantis is saving the day.
Circus show says
The most important thing is that insurance companies make lots of profits. No one cares about you or your house. It’s about money. Ethics are gone. Convicts run the show. Science is woke so it makes total sense to get a 30 yr mortgage in fla haha.
Gerald Tanenbaum says
THE BIG, BIG, BIG problems with HO insurance cost increases in the state of Florida are the lawsuits instigated by state licensed attorneys. MONEY, MONEY AND MORE MONEY that can be “sucked” from the coffers of insurers by litigation and/or threats thereof, end up causing property owners millions of dollars for premium increases by insurers in order to pay the legal fees they themselves initiated.
Laurel says
Gerald Tanenbaum: Then why is it that the insurance companies don’t simply pay fairly for damage done and move on? I’ve seen blue tarps on roofs years after the damage has been done. Instead, these companies have used independent adjusters signatures, and changed documents after signed, to pay up to 90% less than what the independent adjuster had recommended, leaving the claimants stuck with taking the extremely reduced amount, or having to wait it out with a lawsuit. The insurance companies can wait it out longer than your neighbors, and they know it. These people have to pay mortgages, pay rent and still pay the insurance or lose insurance altogether.
Are there scams? Yes. Some scandalous roofers have submitted the claim themselves, inflating the amount. However, the vast majority of claimants are simply regular folks just trying to get their homes fixed after paying to insurance over the years.
Land of no turn signals says says
It’s funny the money pours in from premiums but after it is nit picked and deductibles are subtracted money trickles out to homeowners for repairs.The millions of dollars paid to CEO’S and share holders in yearly bonus’s and perks is ridiculous.Insurance in general is a scam.
Clark G says
With rates going up like they are, I guess I’m glad to hear some CEO didn’t get a gigantic Christmas bonus (to put in a swimming pool with). This is my last year paying into that scam market. Next year and every year thereafter, I’m banking all of what my premiums would have been into investments. I’m my own insurance company moving forward. Kiss my a$$ insurance! Just kiss it!
Ed P says
Also pray that a total loss from some catastrophic event does not occur. A fire?
Even though I haven’t carried a mortgage over the past 30 years, and own my home, I would suggest you take some coverage for the unexpected. Raise your deductibles to save but resist self insuring.
Clark G says
Yea, true, true, but if my property is a total loss, chances are pretty good that so is everyone else around me. Look at the Carolinas, those poor people are still living in tents waiting on insurance and other assistance. It’s not right. The worse the devastation is the slower they’ll move due to the volume of help needed. They’ll move just fast enough to keep the dumpster fire at a smolder. Ft Meyers, the list goes on and on. Small stuff? Same thing: My neighbor had a blue tarp on his roof for over a year from hurricane damage waiting for insurance to pay out for the fix. To me, it’s all a scam and I’ll surly insure myself.
Atwp says
Am glad Republican voters are being hurt by Desantis. Would be nice if a lot of them loose their homes, see what their God Desantis for them. The is little to nothing. Good job Desantis, making the Insurance ceos rich and your traitor park voters poor with nothing. Good for them.
Atwp says
I do agree with one the comments, it is interesting that insurance companies have some of the tallest buildings in the state. They were loosing profits recently, what a lie.
dave says
There is NO rebound, just smoke and mirrors. ,The real test, is your current insurance premium being reduced by hundreds or even a thousand dollars a year. Its not going to happen. Insurance companies are still sending letters about about roof replacements, when concrete barrel tile roof s are still operatable per roofing inspections. But NOOO these insurance insist to keep your coverage you need to spend $50,000 ( which 99% of us don’t have). Home owners insurance is not going to change, its all smoke and mirrors and happy talk, which means zip until your rates GO DOWN, way DOWN.
Ed P says
After reading all the negative comments and researching why nearly 45% of all homeowners claims are denied, I did a more thorough examination to peel back the layers.
A majority of denied claims come from homeowners who file claims against their hurricane insurance when in fact they needed flood insurance. Flood insurance is a separate category and consumers believe if a hurricane causes the flooding they should be covered. They are not. Hurricane coverage also carries it own deductible.
Additionally, since 2022, Florida insurance carriers can nor refuse coverage on a roof if it’s less than 15 years old. After 15 years an inspection is required. The type of roofing material, underlayment and method of installation are all a factor. Depreciation can be a factor in premiums.
The best advice I could find is that a homeowner should clearly understand their coverages, deductibles, exclusions, and if they truly believe they have a valid claim, seek a free legal consult.
It may also benefit a homeowner to hire an independent adjuster to be sure the full extend of the claim is properly paid after the company accepts the claim.
Basically, the insurance industry is complex and many homeowners do not insure themselves properly. The insurance companies are required by regulations to pay all valid claims, but they may need a nudge.
Joe D says
There are ways to lower your policy costs. After Geico (Security First) cancelled my insurance, because I couldn’t PROVE my roof was less than 10 years old. My roof is a flat concrete Slab! Other than periodic sealant…I NEVER have to replace my roof! Too bad for me…their policy was written in stone.
I was referred to a local insurance broker : Flagler County Insurance Agency. They were familiar with how my townhouse development was designed. They recommended ($525) 2 inspections: Wind mitigation and structural inspection. It included an inspection of my roof, which was actually only 4 years old and Potential storm water intrusion.
Since my home is elevated 8ft off the ground, poured concrete, with concrete slab floors and a concrete slab roof, I qualified for MULTIPLE storm remediation discounts. With a $5000 hurricane deductible, Universal Property and Casualty offered a $350,000 replacement policy for around $2400!
That was quite a bit less than the $4200 average other Florida Insurance companies were quoting. It was DEFINITELY worth getting the mitigation inspection!