TALLAHASSEE, Fla. – Dec. 12, 2013 – Citizens Property Insurance Corp. President and CEO Barry Gilway says the state-backed insurer should be down to 925,000 policies by the start of the 2014 hurricane season and around 750,000 policies by the end of 2015.
“Within two years, we should be closing in on that 750,000 number,” Gilway said Tuesday after addressing Gov. Rick Scott and the Florida Cabinet. “We’re launching 2014 in a very positive way.”
Gilway credited a “depopulation” effort to shift policies from Citizens into the private market through Office of Insurance Regulation-approved takeouts of the least-risky policies. The decrease is projected to continue through a clearinghouse that will shop new and renewed policies to private firms when started next year, though the company recently announced a three-week delay in the clearinghouse rollout.
Citizens has seen its number of policies drop from 1.5 million in August 2012 to currently a little more than 1 million, which has reduced Citizens’ financial exposure to claims from a storm – and also reduced the exposure of property owners from having to help cover damages through extra charges known as “assessments.”
“Of the half million people that have moved into the private market, we have reduced their assessment potential that they would have to pay at the worst possible time, when the storm hits,” Gilway said “The vast majority have better coverage than they would have with Citizens and the vast majority have gotten that coverage at a better price.”
Preliminary figures as of Nov. 29 show Citizens total policy count at 1,062,817. As of Oct. 31, there were 1,223,009 policies, according to Citizens’ website.
Through the clearinghouse, all new applicants will be shopped to private firms. If coverage is found within 15 percent of Citizens’ premium, the policy would go to the private carrier. For Citizens customers, renewals will have to go the private market if comparable coverage is found at or below the state-backed insurer’s rates.
Source: News Service of Florida