Citizens Property Insurance Policy Count Continues to Increase
Citizens Property Insurance Corporation continues to add policies at an alarming pace at the onset of this year’s Atlantic hurricane season. Citizens recently hit a weekly total of 12,000 new policies as its total policy count approaches 900,000. With Citizens being the largest residential insurer in Florida, its current policy count is much higher than its total of just over 600,000 a year ago. Two years ago, Citizens had about 460,000 policies, our close to half its current number.
Citizens’ policy count has grown steadily as the proliferation of represented and litigated claims has dramatically increased losses and loss adjustment expenses in Florida. The Florida legislature recently convened in special session to pass reforms attempting to deal with some of the market’s problems. However, lawmakers cautioned that benefits from the reforms likely won’t be realized for more than a year. This estimate might prove to be ambitious, as recent lawsuits challenging portions of the new law might delay its implementation or reduce its effectiveness.
In the near term, Citizens likely will continue add large numbers of policies. Due to the statutory limit on its rate changes, the disparity between Citizens’ premiums and those of the private market continues to grow. Meanwhile, several key insurers have announced in recent weeks they are not writing new business statewide or in select areas. At least one insurer also has closed for new and renewal business due to its inability to place a complete reinsurance program and the subsequent loss of an acceptable rating.