Florida Homeowners: New Insurers Taking Over Citizens Policies

Florida's property insurance market has undergone significant changes in recent years, and if you're a homeowner in the Sunshine State, it's essential to stay informed. One significant development is the recent approval of six private insurers to take over 195,035 policies from Florida's state-owned Citizens Property Insurance Corp. This shift is part of the state's ongoing effort to reduce the number of policies Citizens holds, making room for private insurers to step in and stabilize the market.

Who Are the New Insurers?

Trident Reciprocal Exchange, a new player in Florida's insurance market, is among the six companies approved to take over policies. Trident is expected to take up to 16,035 residential policies starting November 19, 2024. Other insurers involved include American Integrity, Homeowners Choice, Manatee Insurance Exchange, Slide Insurance, and TypTap Insurance. These companies are part of a larger strategy to reduce the size of Citizens, which had grown to 1.4 million policies last year but has since fallen to 1.2 million thanks to the recent reforms.

Why the Takeouts Matter to Florida Homeowners

For homeowners, these changes bring both opportunities and considerations. The takeout process allows startup insurers like Trident to build their portfolios by acquiring policies from Citizens. What does that mean exactly? More competition in the market creates more coverage options for homeowners. Keep in mind the risks, though. Geographic concentration of policies and the companies' reliance on reinsurance, can affect stability in the event of a major natural disaster.

If you receive a takeout letter, Florida law requires that you accept the offer if the new insurer's renewal rate is at most 20% higher than Citizens' projected renewal rate. This rule ensures homeowners aren't forced into much higher premiums when transitioning to a private insurer. However, if the rate exceeds that threshold, you can choose to return to Citizens.

What's Next for Florida's Insurance Market?

These shifts signal a positive move toward stabilizing Florida's property insurance market, which has recently faced rising costs, litigation, and insurer insolvencies. As these new insurers, like Trident, enter the market with strong financial backing, homeowners can expect more competition and, hopefully, more stability in the coming years.

Working with professionals attuned to these market changes is essential for those navigating the insurance landscape. Stay informed, explore your options, and ensure your home is adequately protected as the market evolves.

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