citizens property insurance - News - The Coastal Star2024-03-28T20:33:32Zhttps://thecoastalstar.com/profiles/blogs/feed/tag/citizens+property+insuranceAlong the Coast: Advantages for homeowners hard to see in new insurance ruleshttps://thecoastalstar.com/profiles/blogs/along-the-coast-advantages-for-homeowners-hard-to-see-in-new-insu2022-06-01T16:15:28.000Z2022-06-01T16:15:28.000ZThe Coastal Starhttps://thecoastalstar.com/members/TheCoastalStar<div><p style="text-align:center;"><strong>Related story: </strong><a href="https://thecoastalstar.com/profiles/blogs/along-the-coast-condo-reserve-rules-inspections-become-law?edited=1">Along the Coast: Condo reserve rules, inspections become law</a></p>
<p><strong>By Charles Elmore </strong></p>
<p>Days before the June 1 start to hurricane season, Gov. Ron DeSantis signed what he called the “most significant reforms to Florida’s homeowners insurance market in a generation” as home and condo owners struggled with dropped policies and runaway rates rising sometimes 30% or more.<br /> But legislators in southeastern Palm Beach County questioned how well the plan’s touted consumer benefits stand up to scrutiny, from rate relief to roof rules.<br /> Insurers are getting access to a new $2 billion taxpayer fund to help them cover claims, but GOP legislators rejected amendments from Democrats to tie that to a rate freeze or cut.<br /> “We are giving $2 billion in general revenue, so it’s basically a corporate bailout,” said Sen. Lori Berman, D-Boynton Beach and an attorney. She called it “reasonable” to make sure customers get something out of it.<br /> The companies taking advantage of the temporary state reinsurance layer must refile rates to reflect that during one of the next two years. Bill backers said they could not provide any average or projected savings for consumers, and cautioned that at any given insurer, overall premiums could still rise, though perhaps less than they might have otherwise. They said it may take time, but the important thing is to stabilize the market.<br /> “I think we can say we did everything we could to drive down rates,” said sponsor Sen. Jim Boyd, R-Bradenton, who owns an insurance agency.<br /> Also in the package: a provision that insurers cannot drop policies just because a home’s roof is 15 years old or older. Supporters cited that as an example of how the insurance industry was giving up something in a balanced approach to legislation.<br /> At first glance, “it looks good,” said Sen. Tina Polsky, D-Boca Raton, a mediator and lawyer.<br /> But she asked Boyd during late May’s special session: Can’t insurers simply cite another reason, such as they think they have too much concentration of risk in a certain area, and not renew the policy anyway?<br /> Boyd did not deny it.<br /> “Insurance companies have marketing and underwriting guidelines they employ all the time,” he said.<br /> Polsky said that sounded like a rule with “no teeth.”<br /> On the other hand, she said, insurers were getting a wide array of things they wanted in the bill, such as measures making it harder to sue them for acting in “bad faith.” <br /> Industry officials have blamed what they call abusive lawsuits for driving up costs. A string of companies have gone out of business or are in danger of losing financial ratings in a crisis that has accelerated this year.<br /> But Sen. Gary Farmer, D-Fort Lauderdale, said a big problem lies in state regulations, which allow owners to divert money to affiliated companies and maintain low capital requirements, $15 million. He called that a “joke.” His amendment to double that to $30 million was defeated.<br /> Another rejected proposal: Consider allowing last-resort insurer Citizens Property Insurance Corp. to insure homes worth more than $700,000. That matters in a market like Palm Beach County, where home values have been soaring, particularly near the coast. If state-run Citizens is shut out from a growing share of the market, that can leave homeowners with few options aside from “surplus lines” companies, whose rates are not regulated by the state.<br /> The package revives a safe home program that offers grants up to $10,000 for measures to retrofit homes against hurricanes. It pays $2 for every dollar the homeowner spends for approved purchases. Palm Beach County is within the geographic area eligible for the program, but it is only available for homes with insured value up to $500,000 and the program was not ready to take applications at the time the bill passed.<br /> One option that could lower premiums is a new roof deductible, but it comes with some risk. If the roof does need fixing under certain conditions, the consumer could be on the hook for an amount equal to 2% of the policy dwelling limits or 50% of roof replacement costs. For a $400,000 home, that could mean $8,000 out of pocket.<br /> In the end, legislators labored for assurances the package would help their constituents.<br /> “What is the guarantee I can take back to Palm Beach County that we are going to decrease their premium at all?” said Sen. Bobby Powell, D-West Palm Beach.</p></div>Along the Coast: Insurance bills soar through roofhttps://thecoastalstar.com/profiles/blogs/along-the-coast-insurance-bills-soar-through-roof2022-05-04T17:24:16.000Z2022-05-04T17:24:16.000ZThe Coastal Starhttps://thecoastalstar.com/members/TheCoastalStar<div><p style="text-align:center;"><span style="font-size:12pt;">House, condo owners face spikes of 30% or more</span></p>
<p><strong>By Charles Elmore</strong></p>
<p>Palm Beach County’s southern coast might have been spared a direct hurricane strike in recent years, but residents are getting pounded by an insurance maelstrom only growing in intensity as the start of storm season approaches June 1.<br />Home insurance costs for many are spiking 30% or more, agents say — and even doubling or tripling for some condo dwellers.<br />“They’re obviously in a lot of shock,” said Steven Kirstein, owner-agent at Kirstein Insurance Services in Boca Raton, describing the customer reactions he is encountering. “No one likes it.”<br />Insurers are not renewing tens of thousands of policies. Two have gone out of business since February alone. And those remaining are often demanding tough new terms or vastly scaling back what they will cover.<br />Further shrinking the options: The state’s insurer of last resort, Citizens Property Insurance Corp., does not cover properties worth more than $700,000. Given the rocketing surge in home values, that leaves fewer and fewer properties eligible near the coast. Owners must scramble for whatever they can find — such as “surplus lines” insurers, whose rates are not regulated by the state.<br />Condo owners can feel the pinch in multiple ways. They might pay not only for policies to cover the contents of their individual units, but also assessments to a condo association to handle insurance for outer structures and common areas and the cost of any improvements made to those.<br />In Delray Beach, downtown condo unit owners including Vern Torney felt stunned to realize association assessments could roughly double from $530 per month to more than $1,000. That prospect arrived suddenly after an insurer threatened not to renew coverage unless owners replaced metal roofing about 20 years old, he said.<br />People who lived there thought the roof was fine and even understood it was supposed to last up to 50 years, only to have the insurer insist on the change before hurricane season. That left owners scrambling to assess their options, such as how to pay for it, late into April.<br />“‘Sticker shock’ fits here,” Torney said. “It’s also sort of out of the blue. Just a few months ago we didn’t realize the insurance company was not going to renew us. We were just blindsided on this roofing project and the cost of it. It’s very disruptive.”<br />Conditions have become so jarring that state legislators plan to meet in a May 23-27 special session to address property insurance, though it is far from clear if there is an easy fix or consensus on what to do.<br />From climate threats to contractor lawsuits to soaring property values to inflation in construction and repair materials, a host of issues are swirling together at once for the insurance industry and its customers in Florida.<br />The stream of Palm Beach County customers flowing into Florida’s last-resort insurer, Citizens, shot up 57% in one year to more than 87,000 by mid-April.<br />“The Florida property insurance market is in crisis and on a trajectory toward collapse,” said Mark Friedlander, Florida-based director of corporate communications for the industry-funded Insurance Information Institute.<br />The average home premium in Florida, about $3,600, is the highest in the nation, and it rose 25% in 2021, compared to 4% nationally, he said. The state is projected to average 30% to 40% increases in 2022, he said.<br />State-run Citizens is adding more than 6,000 policies a week and recently passed 800,000 customers statewide, President Barry Gilway said. He expects Citizens to swell to more than 1 million customers by year’s end.<br />“Policyholders in southeast Florida continue to see a very tight market, with many private companies non-renewing policies or placing further restrictions on what they will cover,” Citizens spokesman Michael Peltier said.<br />Owners of single-family homes pay Citizens an average of $3,806 annually in Palm Beach County, up about 8% from last year. Condo residents pay an average of $1,398 to cover the contents of their individual units, a 10.8% rise from 2021.<br />That’s just a county average. Premiums can run higher near the coast.</p>
<p><span style="font-size:14pt;">Citizens seeks max increase</span><br />Buckle up for more. In its latest rate filing, Citizens seeks permission from regulators to raise premiums close to 11% statewide, its legally allowed maximum, by August.<br />Citizens officials said they posted a $166.5 million underwriting loss last year, though the company’s investment portfolio more than offset that to produce net income of $81.1 million. The insurer also has $6.5 billion in reserves to help cover future claims.<br />Not every private insurer has proved to be so stable in a Florida market heavily reliant on smaller, homegrown companies. In February, St. Johns Insurance Co., with 160,000 customers, became the fifth Florida-based insurer to be liquidated since 2019.<br />That was followed in March by an order of liquidation for Avatar Property & Casualty Insurance Co., affecting more than 37,000 customers.<br />Then came reports Lexington Insurance Co., which specializes in covering homes worth $1 million or more, is pulling out of Florida. That affects an estimated 8,000 affluent customers. A company spokesman did not respond to a request for comment. <br />While no major hurricane has recently hit the most heavily populated southern end of the state, storms have made landfall in other places including the Panhandle. </p>
<p><span style="font-size:14pt;">Fix eludes lawmakers</span><br />Incandescent real estate sales along Florida’s southeast coast during the pandemic have sent home values to record highs. Supply-chain issues have pushed up the cost of construction materials. That means properties can quickly get much more expensive for insurers to repair or replace.<br />Meanwhile, the Surfside condo collapse near Miami last year brought renewed attention to risks for seaside structures, which were already under scrutiny as communities weighed how to respond to rises in sea level and other climate issues. State lawmakers failed to reach agreement in the spring’s regular legislative session on a range of insurance, safety and inspection proposals.<br />Many insurers have been trimming their risks in coastal counties. Homeowners Choice Property & Casualty Insurance Co., for example, entered 2022 with 12,485 customers in Palm Beach County, down from 14,020 a year earlier, according to a state database.<br />Then there are the financial ripple effects of weather catastrophes in other parts of the nation and world, affecting the cost of reinsurance — insurance that insurers buy — and insurers’ overall appetite for risk.<br />“Insurance rates continue to climb as home prices increase and unexpected events like tornadoes continue around the country,” said Bill Sample, senior loan officer for Choice Mortgage in Boca Raton. “It is going up like everything else unfortunately.”<br />That’s why insurance agents are having more difficult conversations than they might prefer lately.<br />“It happens every single day,” Kirstein said. </p>
<p><em>Mary Hladky contributed to this story.</em></p></div>Briny Breezes: Citizens hears Briny, adds new mobile home valuation toolshttps://thecoastalstar.com/profiles/blogs/briny-breezes-citizens-hears-briny-adds-new-mobile-home-valuation2015-04-01T18:25:59.000Z2015-04-01T18:25:59.000ZChris Felkerhttps://thecoastalstar.com/members/ChrisFelker<div><p><strong>By Dan Moffett</strong><br /><br /> Briny Breezes and other mobile home communities that complained for months about their insurance problems appear finally to have gotten through to Tallahassee.<br /> Citizens Property Insurance has announced that it will begin accepting alternative valuation methods from policyholders in an effort to allow mobile and manufactured home owners to get more coverage.<br /> “Somebody’s listening,” said Briny Alderman Bobby Jurovaty. “This could be a big help to us.” <br /> In October, Jurovaty and dozens of his neighbors turned out for an insurance workshop at Briny Breezes that state Sen. Maria Sachs, D-Delray Beach, organized and top Citizens officials attended. Brinyites complained that their policies covered only a small fraction of the replacement cost of their homes.<br /> In 2010, the legislature changed the rules for coverage of mobile homes. For those built before 1994, Citizens is required only to pay the actual cash value of the loss, leaving many homeowners vulnerable to large out-of-pocket expenses.<br /> But under the new valuation tools, Citizens will accept MSB and e2Value cost estimators along with the standard 360Value estimator. Simply put, the changes, which can be applied immediately, will help close the gap between windstorm coverage and replacement values for many. <br /> “It’s critical that Citizens policyholders receive the best coverage to meet their needs at the most affordable rate,” said Freddie Schinz, chairman of Citizens’ Consumer Services Committee. “These additional valuation tools will allow Citizens customers to make sure they are getting the appropriate coverage for their homes and provide them with a simple outline to walk them through the valuation process.”<br /> Mobile home owners should talk to their agents to ensure that improvements or upgrades to properties are captured by the coverage valuations. The changes also may enable some homeowners to buy liability coverage that until now wasn’t feasible. <br />For year-round Briny Breezes residents who are living on Social Security or pensions, the new valuation formulas could be especially beneficial.<br /> “This is important because it will allow us to increase the valuation of our property,” said Paul Stewart, a Briny Breezes board member. “But the problem is the timing. Everybody is heading back up north right now, so I’m going to get a hold of people and let them know.”<br /> Stewart, who helped organize the October workshop, says he wants to schedule another one to get the word out on the changes at Citizens. <br /> “I give credit to Sen. Sachs,” he said. “She was willing to step up to the plate when nobody else was.”<br /> Citizens has begun sending out hundreds of thousands of postcards to mobile home owners around the state, advising them to call their agents and explore the changes. The cards also will remind owners that they can insure their homes for 25 percent more than their estimated value.<br /> “We want customers to have the right amount of coverage for their homes,” said Christine Ashburn, Citizens vice president of communications, who came to Briny Breezes in October. “We urge customers to connect with their agents, who are in the best position to determine what’s right for their customers.”</p></div>Briny Breezes: Citizens officials, insurance advocates coming to Briny workshophttps://thecoastalstar.com/profiles/blogs/briny-breezes-citizens-officials-insurance-advocates-coming-to-br2014-10-01T16:34:05.000Z2014-10-01T16:34:05.000ZChris Felkerhttps://thecoastalstar.com/members/ChrisFelker<div><p><strong>By Dan Moffett</strong></p>
<p> Briny Breezes residents will get a rare chance to go one-on-one with state officials over property insurance issues when state Sen. Maria Sachs holds a workshop in the town’s ocean clubhouse beginning at 1 p.m. on Oct. 7.<br /> Sachs, D-Delray Beach, has lined up a panel of representatives from Citizens Property Insurance and consumer advocate groups to discuss problems residents are having with their mobile home policies.<br /> “You will have the opportunity to question them directly,” Sachs says, “and get answers straight from Citizens.”<br /> The relationship between the state’s mobile home parks and the state-run insurer took a dramatic turn in 2010 when the Legislature changed Citizens’ rules for coverage. Under the change, Citizens is no longer required to pay replacement costs on losses for mobile and manufactured homes built before 1994. Instead, Citizens is required to pay only the actual cash value of the loss.<br /> For communities such as Briny, the new rule means that Citizens will pay an owner whose trailer is destroyed in a storm only a fraction — often less than 30 percent — of what it will take to buy another.<br /> The decrease in compensation is part of the Legislature’s effort to reduce the state’s exposure to potential hurricane losses. Over the last four years, Citizens has reduced its total exposure from about $510 billion to $295 billion by dropping high-risk coastal home policies and reducing the coverage obligations on trailers and manufactured homes. <br /> Citizens has gone from a high point of about 1.5 million policy holders to just over 900,000 now as part of the company’s depopulation of policies.<br /> According to Citizens CEO Barry Gilway, the insurer is better positioned to take a hit from a major hurricane since legislators made the changes and now has a total claims-paying capability of close to $20 billion, up from about $16.7 billion in 2011.<br /> Sachs is telling residents to “bring your insurance policies” to the Briny workshop and let the representatives of Citizens and the consumer groups review the coverage on an individual basis. <br /> In 2013, she played host to four similar workshops in Broward and Palm Beach counties.<br /> “What we’re trying to do is bring Tallahassee down to the people,” Sachs said. “Let’s get together and let’s discuss this.”<br /> Admission is free. <br /> The panelists scheduled to participate in the Briny Breezes event are Christine Ashburn, Citizens vice president of communications and legislative and external affairs; Candace Bunker, Citizens manager of legislative and cabinet affairs; Steve Burgess, Tallahassee-based insurance consumer advocate; and Jay Neal, president and CEO of the Florida Association for Insurance Reform in Fort Lauderdale.</p></div>