You may want to keep a close eye on your mailbox this month. Hundreds of thousands of Florida residents are expected to receive a letter warning they’ll be getting a new home insurance company.
The state's largest insurer, Citizens, announced it is shedding a big chunk of its policies.
So, the question may not be, are you ready for a hurricane as the season ramps up, but rather, are you ready for a new insurance company? Some Citizens Property Insurance Corporation customers will have to deal with that in the coming months.
Citizens spokesman Michael Peltier warned more take-out offers would be coming late this year and stressed that policyholders would not be a second without coverage.
“Typically, what happens is companies will express an interest in taking Citizens policies out toward the end of the hurricane season when the risk of hurricanes gets less,” Peltier previously stated.
The company has more than 1.2 million policies. Their CEO, Tim Cerio, has previously stated he wants that number well under 1 million.
“As the market gets healthier, we should shrink,” Cerio has stated.
The Office of Insurance Regulation has approved that Citizens may shed up to 400,000 policies by October, but more could come by the end of the year.
Doug Nellans is a Fort Myers insurance agent with The Insurancenter and said homeowners are relatively safe in the short term because the actual changeover is not going to happen until the end of this year or quarter one of 2025.
Manatee Insurance Exchange, Slide Insurance and American Integrity Insurance Groups are the top three companies taking a combined 218,000 policies. A total of nine companies are expected to each take a chunk of Citizens customers.
- Manatee Insurance Exchange: 78,000
- Slide: 75,000
- American Integrity: 65,880
- Southern Oak: 50,000
- Orion180 Select: 26,128
- Florida Peninsula: 35,000
- Monarch National: 30,000
- Homeowners Choice: 25,000
- TypTap: 25,000
“Historically, we've had a fair portion of our Citizens clients get targeted for this take out,” Nellans stated.
As Citizens policyholders face a 14% rate hike, Nellans predicted many of his customers will likely get takeout notices from the company.
But when asked if he expected those clients to pay more for coverage, Nellans said he was cautiously optimistic they would not.
“With all of the nine carriers that are competing for this business, a lot of homeowners could see similar, if not lower, premiums with Citizens 14% increase baked in,” Nellans said.
Citizens isn’t expected to start sending out the letters until later in August, but the good news is policyholders are safe through this hurricane season.