TALLAHASSEE (CBSMiami/NSF) – The Florida Office of Insurance Regulation has formally approved an early end to a surcharge Citizens Property Insurance Corp. customers have been paying because of damages from the last of the 2005 hurricanes.
The state office issued an order on Monday for the one percent charge to end July 1st, two years earlier than previously slated.READ MORE: Lauderhill PD Investigating Deadly Shooting
“Citizens reports it expects to enter the 2015 hurricane season with more than $4 billion in reinsurance coverage and about $7.5 billion in surplus available to pay future claims — the highest in its history,” Florida Insurance Commissioner Kevin McCarty said in a statement. “That’s important, because Citizens can assess surcharges on all property insurance policies in Florida to cover any shortfalls that may occur in future hurricanes. A higher surplus, too, means that more claims can be paid from cash rather than relying as heavily on assessments.”
The storm assessment has been imposed on insurance policyholders, whether they were Citizens customers or not, since 2007.READ MORE: Citizens Insurance Nears 600,000 Policies
Citizens imposed the storm assessment to recoup $887 million of the roughly $1.7 billion deficit created by Hurricane Wilma, which hit South Florida in October 2005. The state picked up $623 million of the costs from Wilma, while the remainder was covered by additional assessments imposed on Citizens policyholders.
In September, the state-backed insurer’s Board of Governors unanimously voted to support the early end, noting that the balance of the remaining debt on the bonds issued for the 2005 storm will be paid off this year.MORE NEWS: Florida Lawmakers Won't 'Mess With Bingo'
The News Service of Florida contributed to this report.