TALLAHASSEE, Fla. (CBSMiami) – When Governor Rick Scott rode the tea party wave into the governor’s house, he made no secret that one of his main targets to slowly get rid of was Citizens Insurance. The insurance company, owned by the state, will accelerate the process in the next few months.

Citizens’ goal is to get rid of 678,000 policies after hundreds of thousands of Floridians came to the insurance company as private insurers fled the state or offered coverage that was simply out of the reach of most homeowners.

Citizens’ plan is to enact multiple policy changes that will raise coverage and could reduce coverage for thousands of Floridians, according to CBS4 news partner the Miami Herald.

Nicole Coppock writes Citizens policies and she’s been getting an earful from customers where she works at the Furman Insurance Company in Pompano Beach.

“They’re upset with the increase in premiums,” Coppock said. “Unfortunately, a lot of the calls are people who can’t pay their bills.”

Citizens has re-inspected 158,000 buildings in the last two years and another 209,000 are scheduled for this year to check out roofs, windows, and other items that could give Citizens an easy path to raising insurance prices if new rules enacted by Citizens are stringently met.

Coppock, who is also a Citizens customer, has seen her rates rise as well. When her Pompano Beach home was re-inspected, they found problems with her flat roof.

Gene Pridemore said he had a re-inspection as his Coral Springs home and it resulted in higher premiums.

“They came in on a Saturday and they said, ‘no good, no good, no good,'” said Pridemore. “My premium went up $1,500!”

Tuesday, Citizens enacted multiple changes that will impact both new and current policyholders.

  • Homeowners who need to join Citizens will have to submit written proof that there is no private insurer able to provide affordable coverage for their home.
  • Builders’ risk insurance for new homes will no longer be offered.
  • Coverage for carports, screened enclosures, and fences will end for renewal policies.
  • Personal liability coverage limit will drop from $300,000 to $100,000
  • Uncapping rates for new policies, causing new policyholders to pay as much as 50 percent more than existing customers for similar coverage
  • Requiring new electrical and plumbing inspections for older homes
  • Requiring new inspections and likely higher premiums in sinkhole-prone counties
  • Increasing deductibles for “all other perils” coverage

Scott and Citizens both said the insurer must shrink to aovid a financial calamity if a major hurricane hits Florida this year. Citizens has managed to build up a $6 billion warchest over the last 6 years without a major storm, but one hurricane could be all it takes to wipe out the fund completely.

If that happened, Citizens’ customers and possibly all insurance policyholders in the state could have to have assessments.

But the big question no one has been able to answer is where will the hundreds of thousands of homeowners who are looking for insurance go if the private insurance companies don’t offer competitive rates?

The answer to that question will determine if Citzens’ plan can be carried out correctly, or if Citizens will have to grow more as private insurers decide to never re-enter the market for homes in high-risk areas.

Pridemore, who is also an insurance agent said one way to reduce your premiums is to cover every opening in your home with an approved method by Citizens. This would include every door, window, and garage.

But based on the way Citizens has acted so far in 2012, one way or another, hundreds of thousands of Florida homeowners will be paying more for homeowners insurance in the near future.

(TM and © Copyright 2012 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2012 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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