Florida's property insurance market is showing some promise
Eight property and casualty insurers have recently been approved to enter the Florida market.
Florida’s property insurance market has been stabilizing and improving following years of large losses fueled by natural disasters. The Florida Office of Insurance Regulations (OIR) is in an ongoing effort to stabilize and strengthen the market through legislative reforms and by recruiting more insurers to the state. Eight property and casualty insurers have recently been approved to enter the market, and the acquisition of a reciprocal insurer, Trusted Resource Underwriters Exchange, has been approved. The acquisition will result in more than $1.25 billion in capital being invested into the market.
Citizens Property Insurance Corporation, which operates as Florida’s residual property insurance market, has also shown improvement in their financial strength after a few rough years. Citizens had a net income of $746 million in 2023, compared to a loss of $2.2 billion in 2022. Its combined ratio drastically improved to 59.5 in 2023, compared to 204.4 percent in 2022. Citizens’ Depopulation program, an effort to move policyholders from the residual market into the voluntary market, has also been gaining traction. In 2023, more than 275,000 policies were assumed from Citizens, and in 2024, 13 companies have been approved to assume more than 354,000 policies.
In 2023, the Florida property insurance market had a combined ratio that almost broke even, a vast improvement from losing over a billion dollars in each of the last three years, and a profitable operating ratio for the first time since 2016. Insurers have also projected the need for, and established, lower loss reserves, showing there is less uncertainty in the market. The Florida Hurricane Catastrophe Fund rates have also been decreased by an average of 7.38% for participating insurers in 2024.
The full press release can be found here.
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