According to Insurance Commissioner Kevin McCarty, Homeowners Choice P&C Insurance Co. is in line to remove 75,000 policies from Citizens; Florida Peninsula Insurance Co. will take 35,000; Southern Fidelity P&C says it will assume 30,000; and Southern Fidelity wants as many as 10,000 of Citizens' policies.

However, the announcement does not mean each insurer will actually remove the stated amount of polices from Citizens. Policyholders of the last-resort insurer have the option to deny the take-out and remain with Citizens. The latest group of take-out insurers can begin to assume policies Nov. 6 if policyholders give them the green light or do not respond to a take-out notification request.

McCarty says the desire from domestic insurers to assume more policies “sends a clear signal that we have a reinvigorated homeowners' insurance marketplace.” He adds that four more companies—American Integrity Insurance, Tower Hill Preferred, Tower Hill Select and Tower Hill Signature—each have interest in taking policies from Citizens but they are looking for a surplus loan program now bandied by Citizens and lawmakers that would provide loans to financially qualified companies in exchange for taking the risk of Citizens' policies.

Although McCarty's office says about 84,340 policies have been taken out of Citizens already this year and the OIR expects the total amount of take-outs in 2012 to exceed the amounts in 2009, 2010 and 2011—the number of take-outs has dropped drastically since 2008 when the depopulation effort peaked with about 385,000 policies assumed by the private market.

Since then, the amount of take-outs have steadily declined to a total of 53,577 in 2011, according to a recent report prepared by state Auditor General David M. Martin.

In the meantime Citizens' total policy count has increased 43 percent from 2009 to 2011, the report reveals.

Four of 17 insurers that have assumed policies from Citizens since 2008 have been liquidated. Martin's office says it interviewed nine insurers representing 67 percent of the take-out activity over the last several years and the insurers say Citizens' premiums are too low—making it difficult for private insurers to match and stay profitable.

Because rates at Citizens are lower than the private market, many of Citizens' policyholders opt out of the take-out or eventually return to Citizens, the insurers told Martin's office. Additionally, the cost of reinsurance made the take-out policies unprofitable, the insurers say.

Citizens also conducted survey of insurers, which finds more problems. Citizens was retaining some premiums to cover its expenses—a move some insurers thought was an obstruction to depopulation. Sometimes the underwriting guidelines at Citizens were too different than those of private insurers, making the policies undesirable. Finally, the last-resort's policy date was sometimes incorrect and insurers worried about taking on additional unanticipated risks.