77 PERCENT OF FLORIDA HOMEOWNERS ARE SUBSIDIZING CITIZENS PROPERTY INSURANCE CORP. POLICYHOLDERS
~Businesses, charities, religious institutions, renters, automobile policyholders, local governments and school boards also share the burden~
Tallahassee, Fla. – Leaders from statewide business, consumer and environmental groups once again voiced their concerns over the state-run Citizens Property Insurance Corp. following the release of a report by the Insurance Information Institute entitled “Hurricane Andrew and Insurance: The Enduring Impact of An Historic Storm.”
Data from the report indicated that although Citizens has more than 1.4 million policyholders statewide, that number only reflects approximately 23 percent of Florida’s homeowners insurance market leaving 77 percent of Florida homeowners subsidizing Citizens policies. In addition to the homeowners’ subsidies, businesses, charities, religious institutions, renters, automobile policyholders, local governments and school boards also subsidize Citizens.
Further, a breakdown of Florida residential policy data by insurer type revealed a disproportionate burden on private insurance policyholders outside of the Southeast Florida corridor and Hernando County. Nearly half (45 percent) of all Citizens policies in the State of Florida are held by residents living in just four counties – Miami-Dade, Broward, Palm Beach and Monroe Counties. Only two counties out of 67 have a majority of their homeowners insurance policies with Citizens (Miami-Dade and Hernando Counties), meaning private policyholders in Florida’s other 65 counties are subsidizing Citizens’ homeowners insurance for residents of these two counties. And, in those two counties, 100 percent of renters, businesses, automobile policyholders, churches, charities, local governments and school boards are subsidizing their counties’ Citizens’ policyholders.
Abigail F. MacIver, Director of Policy & External Affairs, Americans for Prosperity – Florida:
Americans for Prosperity – Florida was disappointed to learn just how many Florida taxpayers are responsible for subsidizing Citizens Property Insurance Corp. policyholders. We are sensitive to the fact that some homeowners struggle to find an alternative property insurance provider, however it is unfair to require the majority of Floridians to subsidize others’ property insurance, especially when Citizens’ policyholders are paying below market rates. Government interference in the property insurance market has resulted in more than three-fourths of the state paying to keep Citizens’ rates lower than they should be. Our elected leaders must implement solutions that will protect all Florida taxpayers, eliminate the financial burden that is being placed on the backs of the majority of the state’s residents and reinvigorate the private insurance market.
Thomas C. Feeney, III, President & Chief Executive Officer, Associated Industries of Florida:
“It’s unfortunate that more than three quarters of Floridians, and all of Florida business owners, are burdened with the financial responsibility of subsidizing homeowners property insurance for some Floridians in addition to paying 100 percent of their own insurance premium. With estimates that suggest Citizens Property Insurance Corp. rates are roughly 33 percent below where they need to be in order to cover its risk and pay claims, we support the changes the Citizens board is trying to implement and encourage the overwhelming number of Floridians who are not Citizens policyholders to support the board as well. It’s imperative that we reform both Citizens and the Florida Hurricane Catastrophe Fund to better protect all Floridians.”
Manley Fuller, President, Florida Wildlife Federation:
“In addition to the unreasonable financial burden Citizens Property Insurance Corp. places on a majority of Floridians throughout the state, the structure of the state-run insurer has also allowed for subsidized, reckless development in the most hazardous and environmentally sensitive areas of Florida. It’s time to reform Citizens in order to protect Floridians from a financial perspective, while at the same time protecting Florida’s wildlife and coast. Without reform of Citizens and the Florida Hurricane Catastrophe Fund, we risk having to pay insurmountable hurricane tax assessments. If we continue to mask the cost of risk through Citizens’ subsidies, we will eventually degrade Florida’s environment which serves as protection from impending storms and is critical to the state’s tourism and economic development.”
Read the Insurance Information Institute report in its entirety HERE.