Now, it may see policyholder numbers balloon to nicely over 1.5 million, sources mentioned, and a few have predicted it may probably hit two million.
“Citizens is now going to most likely get to 2 million insurance policies due to [insurance companies] non-renewing right here,” Kenneth Tolson, Crawford world president, community options, instructed Insurance Business. “You’re going to see extra firms shedding insurance policies [and these] shifting to Citizens.”
Read extra: Hurricane Ian: Loss tally continues
The Insurance Information Institute (Triple-I) has predicted that the state’s insurer may common 30,000 to 40,000 new prospects each month following Ian’s influence.
At this charge, it might surpass its all-time excessive coverage rely, of simply over 1.48 million, in 2023. The previous report was set, in accordance with Citizens, in November 2011, with publicity of $517.4 billion on the peak.
Insurers in Florida are at present barred from non-renewing or canceling insurance policies till November 28, beneath an emergency order issued by the state’s Insurance Commissioner David Altmaier.
“Between September 28, 2022, and November 28, 2022, no insurer or different entity regulated beneath the Florida Insurance Code shall cancel or non-renew, or problem a discover of cancelation or non-renewal of a coverage or contract of insurance coverage overlaying a property or danger in Florida, besides on the written request or written concurrence of the policyholder,” the order, issued late September, set out.
This signifies that any rush in the direction of Citizens is unlikely to be seen till the tip of November.
However, with the failure of a number of insurers – together with six thus far this yr, with Fed Nat the newest to have been positioned into receivership – Citizens policyholder numbers had already been on the up previous to Ian.
From July 2021 to July 2022, its coverage rely had climbed from 641,000 to above 900,000, and this went on to breach the a million mark within the following months.
It noticed a historic low of 419,475 in November 2019, when publicity was $107.4 billion.
Read extra: Florida’s Citizens Property Insurance hits over one million insurance policies
“Our final estimate pre-Hurricane Ian was that we’d strategy 1.2 million insurance policies by the tip of the yr,” a spokesperson for the group confirmed.
The insurer of final resort mentioned on Thursday that it expects to see at the least 225,000 claims arising from Hurricane Ian, with present estimated losses starting from $2.3 billion to $2.6 billion.
“We haven’t made any projections that deliver us to 2 million insurance policies,” a spokesperson instructed Insurance Business on Thursday.
Florida was already going through as much as an insurance coverage disaster earlier than Ian hit, with premiums among the costliest throughout the US.
Florida owners can count on to spend a mean of $4,231 on their property insurance coverage premium, greater than 3 times the US common of $1,544, primarily based on Triple-I evaluation.
Read extra: Florida and Louisiana in disaster – a story of two states
One issue that the insurance coverage business has argued is driving up premium prices for Floridians is the litigious atmosphere. The sunshine state’s insurance coverage market makes up 79% of nationwide owners’ litigation, however solely 9% of US owners’ claims, in accordance with information from the Florida governor’s workplace.
The state’s legislature moved to fight its spiraling insurance coverage prices and capability problem in a particular session in July, although critics have argued it has additional to go.
Under the statute of limitations, owners have three years to deliver claims from the date a hurricane hits.
Prior to Hurricane Ian, 27 home insurance coverage firms within the state have been on its insurance coverage regulator’s “watch listing” attributable to their monetary standing, Triple-I has mentioned.
“We don’t count on a whole collapse of the Florida home market however it might not shock us if a number of smaller regional insurers fail within the wake of Ian because of the expense pressures of a excessive quantity of windstorm claims mixed with extreme litigation,” cautioned Triple-I company communications director Mark Friedlander.
“This will enhance the volatility of the state’s personal property insurance coverage market.”