Florida Specialty Insurance insolvent, ordered into receivership
A Florida court has ordered Florida Specialty into receivership after it was determined it had a negative surplus of $1.48 million.
A Florida court has deemed Florida Specialty Insurance Co. insolvent and ordered it into receivership.
The Florida Department of Financial Services petitioned the Second Judicial Circuit Court, Leon County, to put the company into receivership after it was determined Florida Specialty had a negative surplus of $1.48 million as of June 30. The minimum surplus required by state law is $10 million. There was no positive realized income through 2019 and there was doubt the company would have future taxable income, according the the DFS petition.
Any remaining policies will be cancelled on Nov. 1, according to the court-appointed receiver, the DFS. The court placed the homeowners writer in receivership for purposes of liquidation on Oct. 2.
Florida Specialty formed in 2015 with the acquisition of Florida home and mobile-home writer Safeway Property Insurance Co. It doubled in size in 2017, when it acquired Mount Beacon Insurance, which was the third-largest manufactured home insurer in the state.
In 2018, Florida Specialty net income rose to $1.4 million after ceding premium in excess of the $94.7 million in direct premiums written. In 2016 and 2017, the company posted net losses, according to its Best’s Credit Report. The carrier’s combined ratio improved 20.4 points last year to 124.7. It’s 2018 policyholder surplus was $16.6 million, down from $32.2 million in 2014.
Florida Specialty was licensed in three states but wrote all premium in Florida, according to the credit report.
It offered homeowners, condos, renters and manufactured homes coverage, the DFS said. It was the 26th-largest homeowners multiperil writer in 2018 in Florida with 0.98% market share, according to BestLink.
Renée Kiriluk-Hill is associate editor of BestWeek. This article was first published by AM Best and is republished here with AM Best’s consent.
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