Citizens Property Insurance Corp. hopes to shed 15 percent of its coastal accounts after board members made a precedent-setting move Monday morning to shift about 31,000 into private hands.
Board members agreed to have Florida-based Weston Insurance Co. take over the approximately 31,000 personal residential, commercial residential and commercial nonresidential wind-only policies that should reduce Citizens coastal exposure by $30 billion.
The move also reduces the potential for emergency assessments, which must be paid by all Floridians, by 11.9 percent.
Citizens is very excited about this first ever depopulation of commercial wind-only policies from our coastal account, Citizens President and CEO Barry Gilway stated in a release.
Weve already begun to receive positive feedback from other insurers and believe this agreement can serve as a model for future depopulation efforts.
Weston, as part of the deal, must offer comparable coverage to those customers acquired from Citizens, with rate increases not exceeding 10 percent a year for the next three years. Weston also agreed to maintain the polices for at least three years.
The Senate Banking and Insurance Committee is expected to consider a bill next week that will further reduce the overall size of Citizens through putting more of the 1.3 million policies into the hands of private firms while expanding the free market and reducing the risk to Florida property owners.
On Friday, Sen. Jeff Brandes, R-St. Petersburg, filed Senate Bill 724, intended to provide greater flexibility for Citizens to make deals with private insurers to share portions of hurricane risk and to set up a clearing house from which private insurers could assume less risky policies without any increase for the policyholders.
Reach Jim Turner at email@example.com or at (772) 215-9889.