Chief Financial Officer Tom Gallagher has announced that the Florida Select Insurance Company has been placed into administrative rehabilitation after the carrier failed to secure sufficient reinsurance. Leon County Court Judge Thomas Bateman approved the state's action and also named the Department of Financial Services as the receiver for the company.

As receiver for Florida Select, regulators will takeover the insurer's day-to-day operations and assets. Under Bateman's order, Florida Select's 70,000 homeowners' policies will not be cancelled and the carrier could continue writing new and renewal business pending an evaluation by regulators. Recently, however, regulators have ordered the company to stop writing new policies. Gallagher said the goal of the department is to preserve the insurer so that it once again could rejoin the voluntary market. If regulators determine the carrier must be liquidated, the majority of Florida Select policyholders likely will end up in Citizens Property Insurance Corporation. Florida Select is a subsidiary of the Vesta Insurance Group, which recently had six other subsidiaries taken over by the Texas Insurance Department.

"Our first priority is to the policyholders by making sure they have coverage during the hurricane season," Gallagher said. "This action will protect homeowners while conserving the company's assets, with the goal of helping it retain enough financial strength to actively compete for business."