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According to the Florida Office of Insurance Regulation, on Nov. 14, Homeowners Choice Property & Casualty Insurance Co. is approved to take out 24,717 policies from Citizens. In October, the company said that 45,000 policyholders chose to leave Citizens for Homeowners Choice, giving the company about 63,000 policies in force (BestWire, Oct. 16, 2008).
OIR spokesman Tom Zutell said six others have been approved for removals on Nov. 14.
Magnolia Insurance Co. can remove up to 28,452 policies; Florida Peninsula Insurance Co. received the nod to take out 25,000 policies; Southern Oak can take away up to 20,000 policies; HomeWise Preferred Insurance Co. can remove up to 17,000 policies; American Integrity Insurance Company of Florida can remove up to 15,000 policies; and Northern Capital Insurance Co. was approved to take out up to 6,500 policies.
Together, the companies taking part in this latest round of take-outs have already assumed about 295,000 policies from Citizens, in an effort to spread the risk throughout the state. Citizens had become one of the largest homeowners insurers in Florida -- growing beyond what the corporation was intended for when many coastal homeowners turned to Citizens for insurance after companies such as State Farm, Allstate and Nationwide pulled away from the coastline.
Ten companies were originally approved as take-out companies in March. Since then, four more have been added. If a policy is selected for removal, the take-out company has to call the policyholder's agent, who has the option of refusing to allow the policy to be removed from Citizens. Florida has required Citizens to notify the policyholder directly if the agent refuses and the policyholder still has the choice to accept the take-out offer.
According to the OIR Web site, the office is currently taking requests for the next round of personal residential take-outs on Jan. 13, 2009 and commercial residential take-outs on Feb. 3, 2009.
The OIR approved plans to remove 500,000 policies from Citizens in 2008 but each designated take-out company can only do so in preset batches. The OIR has said it maintains a watchful eye over the companies and requires each one to prove solvency before another batch of policies can be taken (BestWire, May 21, 2008).
In 2007, the top five writers of homeowners multiperil in Florida, according to A.M. Best Co. state/line product information based on direct premiums written, were: State Farm Group, with a 21.3% market share; Citizens Property Insurance Corp., with 20.5%; Universal P&C Insurance Co., with 6.1%; USAA Group, with 5.2%; and Tower Hill Group, with 4.4%.
(By Chad Hemenway, associate editor, BestWeek: Chad.Hemenway@ambest.com)
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