The largest insurer of property in the Sunshine State says it is asking for an increase of 6.5 percent in homeowners insurance rates, which would add $96 million in premium.Citizens Insurance was created as a last resort for Florida homeowners who could not find adequate coverage for a reasonable rate in the private insurance market. Since its inception, Citizens has grown exponentially, and is now the largest insurance company in Florida.
In his opening remarks, CEO Barry Gilway (pictured) said that while last-resort insurer is striving to become more actuarially sound, it recognizes the financial impact on its policyholders. Still, the entity also has an “obligation to all Florida policyholders who will be called upon to pay assessments in the event our financial resources are exhausted.” (CHAD HEMENWAY, PROPERTYCASUALTY360.COM)
Since it was created to hold few policies, the overwhelming amount of policyholders has left Citizens severely underfunded.
My second major concern is that Citizens is woefully underfunded. Today, Citizens has a little over $6 billion in surplus. But one storm the size of Hurricane Andrew could result in nearly $14 billion in losses to Citizens. That’s an unfunded liability of nearly $8 billion dollars. (Gov. Rick Scott)Too many Florida homeowners are suffering under the crushing rates of Citizens. But, there are other options. At Fearnow Insurance, we write for about 15 different insurance carriers - each one specific to different needs. If you think that Citizens is your only option, please call us. We can find you a more stable and less expensive insurance plan with comparable (or better) coverage. Feel free to contact us for a free quote:
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