Florida's Biggest Insurer Cuts Over 600K Policies After Hurricane Helene

[bronxiteforever]

Florida's Biggest Insurer Cuts Over 600K Policies After Hurricane Helene
Newsweek
Updated Oct 05, 2024 at 4:56 AM EDT
By Aliss Higham
US News Reporter

A property insurer of last resort in Florida is set to hand over hundreds of thousands of policies to the private sector later this month due to overwhelming demand. Earlier this year, regulators in the Sunshine State approved proposals that would allow private insurers to take policies from the state's Citizens Property Insurance Corporation. Citizens, which was created by the Florida Legislature in 2002, provides insurance to eligible Florida property owners unable to find insurance coverage in the private market. It is the largest insurer in the state.

… The number of Citizens policies has soared in recent years as private insurers dropped customers and raised rates due to losses caused by payouts and litigation. Citizens has 1,250,791 policies in force as of August 2024. In August 2019, five years ago, it had 420,366 active policies.

“Citizens is committed to helping its policyholders find coverage in the private market," its website reads. "As required by Florida law, Citizens' Depopulation Program matches Citizens policyholders with insurance companies interested in removing their policy from Citizens and providing private-market coverage for their policy."

… The average home insurance premium in Florida is $3,242 more expensive than the national average of $2,285. In some areas, costs can climb to in excess of $8,000. The state average is second only to Nebraska, where the average premium on a $300,000 home is $5,652.

https://www.newsweek.com/florida-home-insurance-policy-cut-600k-hurricane-helene-1963810

[Walleye]

1. I really don't know why people trust privatizing more than government services

I have had private health insurance and I now have Medicare. I would much rather deal with Medicare than a private insurance company. Medicare can’t raise rates without an act of Congress. Private insurance companies just do it whenever they feel like it.

[Squaredeal]

3. Because "Government is the problem", according to Ronald Reagan.

Translation: “I don’t want ‘those people’ being helped”, even though it means that they’re actually hurting themselves and their own families.

[Xolodno]

16. Technically, its not government if they don't take tax payer money.

As is with most FAIR plans. Usually they are set up by the state in conjunction with private member companies and are non profits. Premiums are often way much higher than private insurers and service is far slower. And if they experience an underwriting loss, they asses the member companies based on market share minus credit for insuring high risk areas.

And private insures just can't do whatever they want. They are far more regulated than banks are.

[wolfie001]

2. As the US is becoming more challenging with all of these 1 in 1000-year events happening with regularity....

....it appears, at least to me, that florida, with the political and weather climates, has become the most dystopian of states to live in. Texas and Arizona are battling for second place. Neck and neck. Many RW 3rd world states I would drive 500 miles to avoid. That list is lonnnnggggg. Thanks for letting me have a nice, cathartic rant.

[jimfields33]

4. I'd rather live weather wise in Florida than a

place with fires, tornadoes, and earthquakes. We at least have time to get out.

Hurricanes give days or more notice to evacuate.

[wolfie001]

5. Well, best of luck

If you're happy there, that's all that matters.

[jimfields33]

11. Thank you! You too for all your endeavors!

[BoRaGard]

6. repubes still gonna lie about Climate Change

even though it is clobbering people in the pocketbook.

Stupid? Evil? WTF?

[Emile]

7. Another hurricane headed towards Florida?

[ProudMNDemocrat]

8. It is a vicious cycle...People BLAME Government for Private Business concerns and Pricing..

When the Private sector charges what it wants because they CAN! Which is the definition of PRIVATE. The Government can make suggestions regarding prices, but few businesses oblige.

I am a small business owner in the Private Sector. I charge for my services based on what the market will bear, not so much to overprice myself out of the market, like many Home Owner Insurance companies do. Which is why I stay busy enough throughout the year. I am one person whose quality standards are high for what I do.

I am at the point where I can choose which types of jobs to do, such as Wedding Gown alterations. I charge an arm and a leg because of how the gown is constructed, the amount of embellishments, regarding lace overlay designs, etc. Which is why I no longer do Wedding Gown alterations. I would rather do Custom work from scratch where I can control my quality. Though I also do quality work on Alterations as well.

Living in weather prone areas are a concern for Home Owners such as Florida, the Gulf Coast, the desert Southwest, etc. Weather and natural disasters are everywhere we live. We take chances every day in hoping disaster never hits. In Florida's case, it sticks out like a sore thumb.

[hatrack]

9. Shocked, shocked!!

Gee, I'm sure private insurance companies will be falling all over themselves to snap up those tasty Florida homeowner policies.

[NickB79]

10. Insurers accepted climate change a long time ago

Their models show huge areas will soon be uninsurable.

Too bad the GOP didn't pay as much attention.

[joshcryer]

13. I did the math awhile ago, we need to migrate 250k people a month...

...to mitigate the effects of climate change. Better believe every hurricane like Helene and every big storm and every flood results in people moving and never coming back.

But it's still not 250k people a month. The effects to people will only get worse as sea level rises.

[joshcryer]

12. So FL has a public option for property insurance....

...but their voters overwhelmingly reject Obamacare and a public option for health insurance.

Sounds about right.

[LauraInLA]

14. Anyone know why Nebraska's insurance rates are so high, as mentioned in the article?

[Xolodno]

17. No one reason.

Tornado's is obviously one reason, sever thunder storms, etc. But lax building codes, lack of emergency services, regulatory market (was always a pain in the ass to file a rate change in that state and the time it finally got approved, the losses forced another rate increase to catch up to the losses occurred while waiting for approval), etc. Very messy market, I think The Harford only has like four agents approved to bind coverage in that state and they are practically underwriters unto themselves.

I shoved +90% rate hikes in that state and the DOI had no choice but to approve it because the losses were demonstratively there (previous dumb as President of the division forced rate decreases so he could meet his promised growth targets to the CEO, he got canned eventually, but the damage was done). If they didn't approve it, we would have walked out of the state. Did so in Louisiana a few years prior.

I no longer work at that company, but work at a FAIR plan now. My whole job revolves around disasters, with climate change, I got some good job security.

[LauraInLA]

18. Thank you so much for the explanation!

[flvegan]

15. Sorta clickbaity OP headline.

"Cuts over 600k policies" sounds like lots of folks are losing their coverage, Florida is doomed, etc. Private insurance is seeking to pick up 600k policies from Citizens, the state run insurance plan.

But hey, it's Newsweek, must have clicks and recs. I get it.

[Red Mountain]

19. They're going to transfer the policies back to private insurance

What happens when those companies don't/can't pay in the event of a catastrophe?

What guard rails does Florida have in place to prevent new underfunded insurers from opening up shop, collecting the higher rates and then declaring bankruptcy when needed?

Florida's insurance business is starting to sound like the electric companies in Texas.