Citizens to shift up to 648,000 policies to private insurers starting next month

Florida’s overburdened insurer of last resort is lightening its load.

The Office of Insurance Regulation (OIR) issued orders this month and last month authorizing 12 private insurance companies to assume up to 648,843 policies from state-run Citizens Property Insurance Corp.

The offloading is part of Citizens’ “Depopulation Program,” which the Legislature approved during a Special Session on insurance in December 2022.

Citizens now has more active policies — 1.25 million — than when the lawmakers approved the plan. That’s largely due to a predictable increase in policies ahead of hurricane season, a Citizens spokesperson told Florida Politics in May.

But the number should decline soon.

On Aug. 2, Insurance Commissioner Michael Yaworsky signed an order allowing 10 carriers to take up to 413,808 policies from Citizens beginning in late October.

Over the past two weeks, OIR approved shifting another 235,035 policies to those insurers and two more, starting in November.

Citizens will soon be shifting up to:

— 140,880 policies to American Integrity Insurance Group.

— 120,000 policies to Manatee Insurance Exchange.

— 50,000 policies to Homeowners Choice Property & Casualty Insurance.

— 55,000 policies to Monarch National Insurance.

— 50,000 policies to TypTap Insurance.

— 16,035 policies to Trident Reciprocal Exchange.

— 90,600 policies to Slide Insurance.

— 15,000 policies to Orange Insurance Exchange.

— 50,000 policies to Southern Oak Insurance.

— 35,000 policies to Florida Peninsula Insurance.

— 26,128 policies to Orion180 Insurance.

— 200 commercial, nonresidential policies to Condo Owners Reciprocal Exchange.

Florida’s property insurance market has been unstable for several years, with rate hikes increasing substantially and companies fleeing the market, reducing their exposure in the state or going out of business.

There have been multiple Special Sessions to address the instability, which has been blamed on lawsuits against insurers, rising replacement costs in the wake of catastrophic storms and large hikes in the cost of reinsurance, which provides backup financing to insurers.

In the past few Legislative Sessions, lawmakers placed strict new limits on lawsuits against insurance companies and provided them with billions of dollars to help offset the rising cost of reinsurance.

A new law, which in March passed unanimously in both chambers of the Legislature, allows “A”-rated insurers from outside of Florida that haven’t been admitted to the state market to take over Citizens policies as part of the depopulation plan.

OIR doesn’t approve the rates of such companies and claim disputes must be resolved in a court outside the Sunshine State. However, any plan to shift a Citizens policy to one of those companies, known as surplus lines insurers, must be OK’d by state regulators.