TALLAHASSEE (CBSMiami/NSF) — Citizens Property Insurance Corp. is starting to advise many homeowners with expiring policies that they have to go through an electronic clearinghouse intended to shift more policies into the private market.
The state-backed insurer started to send letters this week to multi-peril policyholders with coverage that expires Nov. 1 that they will be the first renewals placed in the computerized system that could spin them toward one of six private carriers if equal or lower rates are available.READ MORE: Centner Academy Reverses Course On 30-Day Quarantine For Vaccinated Students
Citizens views the clearinghouse as a means to reduce both its overall number of policies and financial risks for the carrier and customers.
“Many customers will benefit from more-comprehensive coverage, lower pricing and vastly reduced assessment risk in the event of a major storm,” Citizens President Barry Gilway said in a prepared statement Tuesday.
Through the process, homeowners will be sent a letter about 75 days prior to the renewal date.
The homeowners would become ineligible for renewal with Citizens if potential rates from any of the six carriers — Florida Peninsula, Federated National, First Community Insurance, Heritage Insurance, Tower Hill Insurance and Southern Oak Insurance — are equal to or less than the rate that would be offered from Citizens.
If private coverage isn’t available, the policyholder would get a renewal package about 45 to 50 days prior to the end of the existing policy.
Citizens spokesman Michael Peltier said it is unknown how many of the approximately 686,500 current homeowner multi-peril policies will eventually be picked up by private carriers.READ MORE: Gov. DeSantis Wants To Offer $5,000 Bonuses To Law Enforcement Officers Who Come To Florida
The clearinghouse process was introduced in January for people seeking new Citizens policies.
While Citizens has seen its monthly average of new policies drop from around 26,000 in 2013 to 16,000 this summer, Gilway said July 10 that the clearinghouse has been credited with placing 3,300 new policies with private firms.
More recent numbers were not immediately available Tuesday.
Citizens planned to begin putting existing customers into the clearinghouse in July, but delayed the start date at the request of contractor New York-based Bolt Solutions, Inc., which received a five-year contract last year to design the software for the clearinghouse.
Reducing the number of polices, and thus the potential exposure to the state, has been a focus of government officials in recent years. As of July 31, Citizens had 933,807 policies in force, down from 1.43 million in May 2012.
“The News Service of Florida’s Jim Turner contributed to this report.”
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